As the United States faces unprecedented challenges andopportunities around the world, Secretary of State CondoleezzaRice has unveiled a bold new vision of American diplomacyfor the 21st century known as “transformational diplomacy.”According to Secretary Rice, transformational diplomacy is avision rooted in partnership, not paternalism—in doing thingswith other people, not for them. “I think,” says AmbassadorPatrick Kennedy, that the major focus of transformational diplomacyhas to [do with] getting our personnel out and operating

The Bureau is responsible for administrative support operations; supply and transportation; real property and facilities management; official records, publishing, and library services; language services; domestic emergency management; overseeing safety and occupational health matters; small and disadvantaged business utilization; and support for both White House travel abroad and special conferences called by the President or Secretary of State.

Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business. The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness.

You can find out more about the Center by visiting us on the web at businessofgovernment.org.

And now, The Business of Government Hour.

Mr. Morales: Good morning. I'm Albert Morales, your host, and managing partner of the The IBM Center for The Business of Government.

With its unveiling of transformational diplomacy, the U.S. Department of State has charted a bold new course in U.S. diplomacy, a course that rests on working with U.S. partners around the world to build and sustain democratic well-governed states using America's diplomatic power and resources to help people across the globe better their own futures, build their own nations and thrive under an umbrella of security and peace. Supporting this ambitious approach seems no small feat.

With us this morning to discuss his Bureau's efforts in support of transformational diplomacy is our very special guest, Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State.

Good morning, Raj.

Mr. Chellaraj: Good morning, glad to be here.

Mr. Morales: And joining us in our conversation is Bonnie Glick, project executive at IBM.

Good morning, Bonnie.

Ms. Glick: Good morning.

Mr. Morales: Raj, most of our listeners are probably familiar with the Department of State as the diplomatic arm of the U.S. government. But perhaps you could give us a sense of the State Department and its history. When was it created, and how has its mission evolved over time?

Mr. Chellaraj: Surely. The State Department was the first federal agency, created in 1789. Thomas Jefferson was our first Secretary of State. It is the lead U.S. foreign affairs agency. Currently, Secretary Rice has defined transformational diplomacy in this way: it is to work with our many partners around the world to build and sustain democratic well-governed states that will respond to the needs of their people and conduct them responsibly in the international system. That means all of us need to think about how we are doing business, and adapt and change to meet these new priorities.

Here are some current initiatives under the leadership of Management's Under Secretary Fore: one, provide buildings and administrative infrastructure to 38 agencies overseas; maintain American presence with over 260 embassies and consulates, utilizing technology with virtual posts that can be accessed from anywhere in real time; help to ensure secure borders and provide a dignified welcome to visitors.

Mr. Morales: Raj, obviously, this is an extremely broad mission. Can you give us a sense of the scale at the Department of State? How is it organized? Can you give us a sense of the budget, the number of full-time employees, and its geographic footprint?

Mr. Chellaraj: There are nearly 57,000 employees worldwide. Nearly 45,000 of them are overseas. Over 7,500 Americans proudly call the State Department home who are overseas, and 37,000 locally engaged employees. There are more than 260 posts in 189 countries, and also in the United States. The State Department's appropriation for the past several fiscal years has been roughly $30 billion per year, and includes both State operations and foreign assistance. The FY 2008 request is about 11 percent increase, and it's around $36 billion.

Ms. Glick: Now that you've provided us with a sense of the larger organization, maybe you could tell us more about your specific area and your specific role within the Department. What are your responsibilities and duties as the Assistant Secretary of State for Administration? Could you tell us a little bit about the areas under your purview, how your area is organized, the size of your staff and your budget? Also, given the Bureau has responsibility for both overseas and domestic operations, can you give us a sense of how you balance limited resources between domestic and overseas operations?

Mr. Chellaraj: Wow, there are a number of questions in that one question. So let me just at least highlight the key areas. Some departments, as you know and our listeners know, have offices. Our department has Bureaus. So the Bureau of Administration provides global administrative support for the people and programs of America's diplomacy. We are proud that our work supports every foreign policy initiative, every employee and family member and every agency that's involved in foreign affairs activities.

The "A" Bureau is one of the Department's most diverse and dynamic organizations. The "A" Bureau budget is approximately I would say $600 million, with over 2,000 employees in over 30 offices. The Bureau's mission is making diplomacy work. And when I joined the Bureau, I added the word "better," making diplomacy work better. One of my priorities and our priorities in our Bureau is customer service and satisfaction. Our Bureau programs and services are very varied.

Let me just highlight on some of them. One, domestic real property and facilities management. We do procurement, roughly $5 billion or so a year, and that's a billion with a "b." Supply and transportation. Diplomatic pouch and mail services. Official records, publishing, library services, language services. Setting allowance rates for U.S. government personnel assigned abroad, and that's a fairly key one, as you can imagine. Overseeing safety and occupational health matters, small disadvantaged business utilization. Support for both White House travel abroad and special conferences called by the President and Secretary of State.

We also do direct services to the public and other government agencies. These include authenticating documents used abroad for legal and business purposes, responding to requests under the Freedom of Information and Privacy Acts, printing official publications, codifying policies into Department regulations, designing, publishing, and maintaining the Department's electronic forms, processing all Department public notices for publications in the Federal Register, and the list goes on.

Ms. Glick: The list does appear to go on. You're quite right when you say the responsibilities of the "A" Bureau are very varied. Regarding those responsibilities and duties, what would you say are the top three challenges that you face in your position, and how have you addressed those challenges?

Mr. Chellaraj: Surely. There are many challenges just based on the types of things we do, and frankly, we look at challenges also as opportunities to see how we can improve overall customer satisfaction. Let me give you three specific ones. Firstly, our posts are scattered throughout the world in different working environments with different technological capabilities and operating constraints, and so you can imagine the issues associated with that.

Secondly, in addition, emergency or crisis situations arise, as was the case when the war broke out in Lebanon last summer. We provided the logistics support, ships, planes, not quite cars, but vans and buses for safe passage of American citizens, 15,000 of them approximately, out of harm's way. By having sound and well-thought-out management processes in place, we are able to respond to these types of unexpected situations quickly and effectively.

Thirdly, it is really difficult to predict where the next challenge will arise, so we have our antennas and radar up and be very vigilant in terms of where the next challenge will come from.

Mr. Morales: Raj, I want to switch gears a little bit here and talk about you. You've had obviously a very diverse background, starting in the private sector and now migrating over to various roles within government. I'm curious, how did you begin your career?

Mr. Chellaraj: Surely. I immigrated to the United States with a Bachelor's degree in Engineering and a couple of dollars. I realized very soon after I got here that the American education, the critical thinking was a great equalizer, and so I worked, went to school, worked, went to school, and did this a few times, and I moved from the focused field of engineering to the broader issues of public policy.

The early days were simply tough, but I struggled and survived. And career-wise, I moved between private sector and government many times, and I would encourage your listeners out there who are considering a public sector career and an opportunity to come contribute in the government to consider doing that. And over the last 25 years, this is my fourth agency in government, and this has been a real tremendous opportunity. And I will always come back when a President calls, when the Secretary of State calls or when I'm called upon to serve the country.

Mr. Morales: That's fantastic. So with these various experiences both in the commercial sector as well as now in government, I'm curious, how have these experiences shaped and formed your current leadership style, and how are you applying those experiences to your current role?

Mr. Chellaraj: I have handled and been responsible for most of the functions that are currently in the Bureau of Administration in my prior life, prior career, either in government or in the private sector, and I really believe good management transcends both the public sector and the private sector. And let me give you an example here. Take procurement, for example. In government, you have the Federal Acquisition Regulations, known as FAR, which I'm sure our listeners are familiar with.

In the private sector, it's not too different. There's what is called DOAG. You know, there are always all these acronyms, and essentially, DOAG is Delegation of Authority Guide. And the principles are essentially the same, in areas like procurement. You want to have the proper checks and balances, the internal controls, and who can sign up to what limits, and the principles are the same. People generally say -- either when I'm in the government or in the private sector, and I hear this in government a lot -- we are really a unique organization. We are different. Not really sure whether something will work, and what I really look for is commonalities and similarities on how we can improve processes to be more effective.

Mr. Morales: So even though the core missions are different, many of the core fundamentals are really the same between the commercial and the public sector.

Mr. Chellaraj: That's absolutely true.

Mr. Morales: How is State administering its resources in more efficient ways?

We will ask Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State, to share with us when the conversation about management continues on The Business of Government Hour

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State.

Also joining us in our conversation is Bonnie Glick, project executive at IBM.

Raj, given the release of the joint State and USAID strategic plan for 2004-2009, could you tell us about the efforts to integrate USAID operations with those of the State Department, and what efforts has the Administration Bureau undertaken to streamline its operations in line with the efforts of the Joint Management Council of State and USAID?

Mr. Chellaraj: Thanks, Al. Again, there are several questions there, and I'll try to highlight the key points. Interestingly enough, I worked at USAID a while back. In fact, my office then was on the same floor as where I am today, just down the hall. Who would have thought I'd be back again?

Frankly, USAID does certain functions very well, and State does certain functions well. This is about getting the best of both. State and USAID have been attempting to restructure our overseas presence to meet the challenges of transformation diplomacy and sustainable development. We both recognize the need for a shared overarching vision for management partnership, overseas and domestically, to contain growth and consolidate administrative support services. The Joint Strategic Plan established the Joint Management Council. The Joint Management Council's mandate is to identify opportunities for cooperation, cost avoidance and improved service through operational improvements. The results from our pilot posts are very encouraging.

We believe the joint approach will result in significant savings as well as a more logical, more manageable administrative platform at our overseas posts. Our focus in the Bureau has been identifying the activities where we carry out tasks that are common to both organizations. We believe that by doing this, we discover opportunities to both save money and enhance performance for both of us.

Mr. Morales: So how has this joint effort enhanced the ability of both organizations to ensure that the nation's foreign policy and development programs are fully aligned, and how has it impacted your workload?

Mr. Chellaraj: Sure. In terms of impacting the workload, it is a little difficult to quantify, as some individuals and offices directly concerned with the joint management initiative work on projects would be underway regardless of whether we had a joint management effort. Let me give you an example. We have something called the Integrated Logistic Management System, or ILMS. This is a very customer-friendly IT platform that enables us, both our contracting officers, logisticians, and most importantly, our customers, to track items from the time they are purchased until they're eventually disposed of.

Through ILMS, we get a clearer picture of our worldwide logistics operation than we've ever had before. Enhanced transparency and a whole new level of accountability for our resources. This particular initiative and effort will be important to the success of joint management, particularly overseas.

Mr. Morales: So to provide a more specific and broader context, could you provide a brief overview of such initiatives, such as the right sizing initiative and regionalization?

Mr. Chellaraj: Surely. Transformational diplomacy has a number of ramifications for the Bureau of Administration, and Department management generally. For example, we're addressing the practice of each Bureau or post providing the full range of administrative services. Today's technology allows, as you know, many of these functions to be performed by a smaller group of people anywhere in the world and shared among Bureaus and posts. For example, the Department is working on establishing human resource centers of excellence.

The Bureau of Administration's executive office is one of those centers of excellence. Overseas, the security environment concerns underscore the need to provide the most efficient support services in the safest possible locations. My office is working with the regional bureaus to expand the number and scope of services currently provided by regional support centers located in Frankfurt, Bangkok, and Fort Lauderdale.

Another regionalization initiative that the "A" Bureau spearheaded along with the regional bureaus is the standardization of support services according to best practices identified and endorsed by a central governance council. These efforts I'm sure will facilitate our ability to further consolidate and regionalize overseas support services.

Ms. Glick: That sounds great. Given even tighter budget constraints, would you tell us a little about your efforts to administer the resources of the Department in the most efficient ways? How has the International Cooperative Administrative Support Services System that's known as ICAS assisted you in this regard? How does it operate and who uses it, and to what extent has it achieved its primary goals? Are there any plans to enhance the ICAS system and its use?

Mr. Chellaraj: Bonnie, the ICAS system that you refer to is really a cost-sharing mechanism. Industry has been using this for 15-plus years, and it provides us, the U.S. government, a platform for overseas shared support services. The State Department is the primary service provider at more than 260 posts worldwide. State provides these services for the Department employees, and most importantly, for the employees of dozens of other federal agencies posted overseas. There are more than 280 separate entities that receive invoices under the ICAS system. And it is really a customer-driven interagency mechanism for managing and funding administrative support services.

For example, it gives the post the authority to determine how services are delivered at what cost and by whom. This is about acting locally, ensuring that service providers are formally accountable to the customer, and incorporates a full-cost recovery mechanism for the Department of State.

Ms. Glick: Raj, you serve as chair of the ICAS Executive Board. Would you tell us about the strategies ICAS has developed to address several recommendations outlined by the General Accountability Office regarding the need to improve ICAS accountability and enhance its cost containment capability?

Mr. Chellaraj: Surely. The ICAS Executive Board -- let me just give you a little background on that. It is really composed of 15 senior representatives of Cabinet-level agencies, and we meet quarterly or more often depending on what the needs are. And this is set up similar to -- akin to a corporation that would have a board of directors and management. There is a working group -- we have several subcommittees, and it is staffed and funded office within the Department of State. You're right, the GAO's report in -- I think it was in September of 2004, which was the first systematic review of the ICAS performance since it was established in 1998.

And overall, I must say the GAO found that ICAS is generally effective in providing quality administrative support in an equitable and transparent manner. Like all organizations, we take these recommendations seriously, and it will continue to be a work in progress as it evolves and we adopt the recommendations and continue to move forward.

Mr. Morales: Raj, I want to turn to the President's Management Agenda for a moment. The Department of State is one of only two federal agencies out of about 15 that have recently achieved a Green for both status and progress on the PMA's federal real property initiative. Could you elaborate on this achievement, and could you tell us about your efforts in developing and implementing an OMB-approved asset management plan? And I'm curious, what advice would you give to some of your colleagues who are perhaps pursuing the same area?

Mr. Chellaraj: The responsibility for asset management of real property is really shared by two bureaus within the Department, the Overseas Building Management office and the Bureau of Administration. In terms of advice, the short answer is there are no quick fixes. Be real detail-focused, results-oriented, and continue to monitor the progress.

Mr. Morales: Now, competitive sourcing is another initiative under the PMA. Could you tell us about some of the key competitive sourcing initiatives being pursued by State that have affected your Bureau, and as a member of the Competitive Sourcing Executive Steering Group at State, could you give us an update on your Department's overall progress in this area?

Mr. Chellaraj: Surely Al, happy to. The important thing about competitive sourcing is we are looking for the most effective outcome for the government, whether the work is done inside the government or outside. And competitive sourcing is not outsourcing, and that is a concept that has been misunderstood. It is a really effective management tool, a tool designed to obtain the best value for the government, whether the work is done internally or externally. We completed the first standard competition, and it was to transform printing and publishing activities for the Department, with an estimated savings of $80 million over the next 10 years.

This is fairly significant. Modernizing printing and publication services will -- we believe -- will enhance the Department's ability to communicate its public diplomacy message in a more-timely, compelling and visually interesting way to overseas audiences. There were actually three offers that we received, and the award went to the revamped in-house organization, the Global Publishing Solutions Group. The in-house organization shifted to a market-driven pricing arrangement and adopted industry best practices and performance standards.

The Department overall from a broader picture on competitive sourcing has a green plan charting future studies which we have submitted to OMB, and we've committed to plan in terms of how we move forward. We are reviewing other administrative functions and really rethinking how the Department delivers domestic administrative services.

Mr. Morales: That's fantastic.

What are some of the challenges in administering the diplomatic missions in Iraq and Afghanistan? We will ask Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State.

Also joining us in our conversation is Bonnie Glick, project executive at IBM.

Raj, what are some of the significant challenges your Bureau faces in administering the diplomatic missions in Iraq and Afghanistan? How does the model for overseas management support within your Bureau ease the burden of administrative support in dangerous posts such as these?

Mr. Chellaraj: Thanks Al, for that question. Operationally, the model for overseas management support is now known as the Iraq Orientation In-Processing center, OIP. This center developed several concepts and methods to ease the burden of administrative support in danger posts. While developed for danger posts, many of these have potential applicability for other overseas posts.

Employees from all federal agencies who are bound for Iraq and who are subject to chief of mission or the ambassador's authority, go through the center to receive their electronic check-in, their OpenNet and e-mail log-ons, cyber security training, deployment support, common access cards and so forth.

This remote check-in process allows the employees to take up their responsibilities sooner at posts. It also saves embassy human resource personnel and diplomatic security staff considerable time and effort in the processing, and spares them from responding to policy questions from multiple federal agency headquarters and entering security eligibility data into the Department of Defense systems.

Mr. Morales: Now, Raj, earlier we talked about the very complex mission that your organization has, so I'm curious, what kinds of interagency, private sector, and nonprofit partnerships are you developing to improve operations or outcomes at State, and what are you doing to enable the success of these partnerships and collaboration efforts?

Mr. Chellaraj: Sure, happy to address that. Our offices throughout the A Bureau partner with other government agencies, the private sector, and nonprofit organizations regularly to achieve their individual missions. I encourage the A Bureau staff to seek out the best in class in their respective fields, both government and private sector, and benchmark against them.

For example, we sponsor the Management Immersion Program, where we place Foreign Service officers in recognized, well-managed external organizations to learn management best practices and bring them back to their posts and the Department. Another example is our Overseas School Advisory Council. Having been a product of several degrees myself, I take real pride, and this is very important to me and for us in the Administration Bureau and the Department.

In '67, the Department of State established the Overseas School Advisory Council, a public-private partnership with U.S. corporations that have substantial overseas operations. OSAC, as it's known, is the longest-running advisory committee in the Department. The purpose of this partnership is to obtain the advice and support of the American corporate community in providing quality education for U.S. citizens, children attending overseas schools.

Currently, there are 194 American overseas schools in 132 countries assisted by the Department of State, and serve 112,000 school-age children of U.S. government and private sector employees stationed abroad, as well as children of host country and third country nationals.

Mr. Morales: Along the same lines of partnerships, could you tell us about the Department's commitment to the small and disadvantaged business community? We understand that your Bureau annually recognizes selected small business contractors who have displayed exemplary performance. Could you tell us more about this award and your Bureau's efforts in this area?

Mr. Chellaraj: The Department of State is committed to ensuring the small businesses, including small disadvantaged, (8a), women-owned, HUBZone, and service disabled veteran-owned small businesses have the maximum opportunity to participate in the Department's acquisition.

For example, last year, the Department awarded approximately $1.3 billion to small businesses. The Department's Office of Small and Disadvantaged Business Utilization is a strong advocate for small business firms, and has a strong history of providing outreach to the small and disadvantaged business community.

Our office participates in many small business outreach events locally and throughout the U.S. that offer small and disadvantaged business with opportunities to learn about contracting. For example, we participated in 38 events last year. We also have a successful record of achieving small business goals.

Here's something we're very proud of: the Small Business Administration presented the Department with the Gold Star Award for excellence in achieving small business goals in both 2005 and 2006. We are also proud of the mentor-prot�g� program, which encourages large business prime contractors to provide mutually beneficial assistance to small businesses.

The Department recognizes the achievements and contributions that small businesses make to its mission during the annual Small Business Prime Contractor of the Year Award ceremony. The Award is sponsored by the Bureau of Administration. It recognizes contractors that have displayed exemplary performance, customer service, management and technical capabilities.

The 2006 award was presented to a team of four highly skilled interpreters, translators, who traveled with our ambassadors in Iraq and provided interpreting support. We also host a small business trade fair at the Department each June for firms that sell office supplies and common usage items, as well as three information technology fairs a year, a prime subcontracting networking session in October and in veterans business affairs. So we do quite a bit in this area, and that is why we are successful, and we're really happy that the Small Business Administration has recognized us for this.

Mr. Morales: That's quite impressive.

Ms. Glick: Turning again to the topic of language services, the State Department has an Office of Language Services that effectively delivers timely, world class interpreting and translating services to the Department as well as language training.

A significant challenge, though, facing this program is recruiting a pool of direct hire employees and contractors who are among the world's best interpreters and translators. How has your organization handled this challenge, and are there any plans to relax some of the Office of Personnel Management's applicant rating procedures and security clearance requirements, which may hinder the recruitment of direct hire employees in this area?

Mr. Chellaraj: Surely. This is a very critical area for us, and we compete head-on with many organizations, particularly international organizations. Our language staff services has a staff of approximately 45 interpreters and translators working in eight languages, and a roster of 1,500 contractor interpreters and translators in 40 languages.

Finding talented individuals to perform these tasks, evaluating their abilities and ensuring that they can pass the necessary security scrutiny will always be a challenge. State Department has certain advantages, we believe. The work we ask our interpreters and translators to perform is difficult, but it's also interesting and it's international. Anyone who can say they work for the State Department, whether as a staff employee or as a contractor, enjoys considerable respect in the profession, we've come to know, because we are well-known for the rigor of our testing process.

In our recruiting efforts for qualified contract interpreters and translators, we require individuals with the highest skill levels and in many languages, and this means that the pool of qualified applicants is limited, in some instances because there's no recurring commercial need for interpreters and translators, and certain languages of limited diffusion.

We actually have to find individuals with strong language skills and provide them with training in interpreting or translating. Let me give you some examples. We've achieved considerable success in the programs we've organized in such languages as Haitian Creole, Urdu, Hindi, Albanian, Vietnamese, Macedonian, Turkish and Greek.

The search for interpreting and translating talent, particularly for the languages of limited diffusion will be an unending quest, and it'll continue. Our staff attends conferences, seminars, regional gatherings, academic symposiums, and job fairs to find the talent we need to perform the work that is required by our clients at the White House, the National Security Council, Department of State, among others.

We also work closely with our colleagues in the Bureau of Diplomatic Security, turning to your question about the security challenges, to perform the required background checks in a timely manner. We receive excellent support from our Diplomatic Security Office, but there are no shortcuts, as you know, when you're trying to do background checks on people who have lived all over the world. This will always continue to be, I believe, a work in progress.

Ms. Glick: As the Chief Acquisition Officer, would you give us a sense of how procurement works within the Department of State? Given the State Department's global footprint, how decentralized are procurement operations within the Department, and what are the benefits of this decentralization, what are some of the challenges? Also, to what extent does your acquisition model emphasize the customer is king approach within your area?

Mr. Chellaraj: Sure. Procurement is a key area for us. In our Department, it is unique, because we have over 200 individual procurement offices at each embassy and post. These offices are located in virtually every country on the planet, with every imaginable set of market conditions. Some of this procurement must be done at post, because necessary goods or services can only be obtained there. Some examples would be renting a facility for a conference or obtaining janitorial service and vehicle maintenance.

These overseas procurement responsibilities are handled by Foreign Service officers who generally manage procurement, as well as a larger portfolio which could include warehousing, shipping, housing and motor pool operations. Locally hired procurement staff would support our Foreign Service officers.

For both the Foreign Service officers and local staff, one of our priorities is to provide worldwide training and oversight of this procurement workforce. Our Office of Procurement Executive, which is in our Bureau, uses the Department's improved Internet capability and e-mail to assist with these trainings. We have all the online training, we have the website, we have the help desk. So all we have made as part of standard operating procedure.

And the Department also uses regional procurement support offices. These are the ones I mentioned earlier in Frankfurt, Fort Lauderdale. It doesn't have to be procured from posts; if it doesn't have to be, we don't do it. We do it regionally as best as we can.

We're also focusing more on our technical representatives. In government, it is called COR, Contracting Officer Representative. And we hold seminars to build a community of practice. These CORs need to learn from each other. This is in addition to the normal training required to be designated a COR at the Department. We are also focusing on strategic sourcing. We've selected medical supplies, furniture, and digital copiers as strategic sourcing targets, commodities that the Department uses throughout our worldwide operations.

For example, we are piloting buying medical services by teaming up with larger partners such as DoD and the Veterans Administration. We are negotiating furniture contracts that'll standardize the types of furniture at posts for easier asset management and will leverage our worldwide purchasing power. With digital copiers, we are more concerned about supplier management and increasing the availability of suppliers.

So there are a number of things under way. Procurement is a real critical function, and we want to ensure that as we standardize and we change some of these processes, we maintain procurement integrity and the proper internal controls and the checks and balances are there.

Ms. Glick: That's great. One of the other areas that you focus on is in the area of allowances, and the Office of Allowances coordinates policies, regulations, standards and procedures for overseas allowances and differential payments throughout the federal government. Would you tell us about the e-Allowances Initiative, and what is the status of this initiative in its implementation?

Mr. Chellaraj: This is an area, where again, we are trying to focus on the customer and improve the service. The Office of Allowances, which is very closely monitored, for obvious reasons, as you can imagine, protects the interests of U.S. government and its employees and families serving overseas by ensuring that overseas allowances and differentials are appropriate to reimburse them for extraordinary costs and difficult living conditions associated with serving abroad.

Conditions at our overseas locations may change abruptly. Our current subsystem for submitting and reviewing allowances is a paper-based system, which obviously will have a lag, as you can imagine. And we really think this delay is unacceptable and began developing e-Allowances, an online way of doing things with quicker turnaround, so the surveys are done, it's reviewed properly, and the adjustments are made in a very effective manner.

Mr. Morales: What does the future hold for the U.S. Department of State?

We will ask Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State.

Also joining us in our conversation is Bonnie Glick, project executive at IBM.

Raj, given the management changes already underway at the Department, where do you see the Bureau of Administration going in, say, the next five years?

Mr. Chellaraj: Sure. If I had to blue-sky this, my objective during my tenure is to ensure that the fundamentals are in place and working well, that we have the flexibility to respond to the changes coming in the future, such as the new IT capabilities. And it's a work in progress, and certainly will be influenced by the external environment.

There will continue to be an evolution to more quicker turnaround, you know, better cycle times, solving issues in real-time.

To your point about advice for successors, I would say focus really on people. People are the key to making things happen, and I would say attracting a talented, innovative, diverse team of experts on the Bureau team, and continuing to do so, is very important. We are currently focused on that, and the Department and the Bureau need to focus on that, and also the processes -- do the standard operating procedures -- are they making sense, and are we doing things the most effective and efficient way possible?

Mr. Morales: Now, Raj, I understand that BusinessWeek has identified the State Department as one of the top 10 places to launch a career, specifically for new college graduates, and was the only federal agency listed in the top 10.

Could you tell us how significant this recognition is to your Bureau, and how has this recognition benefited your Bureau?

Mr. Chellaraj: Oh, this recognition is very important. As you know, competition is intense for top-notch employees, and on that list you will find many recognizable names who are in the Fortune Top 10, Top 20 companies. I recently spoke at an entry-level officers' conference for those serving on their first or second tour in the Middle Eastern region, and the work experience and the academic credentials these individuals offer the Department are very impressive. They represent a wide range of backgrounds and areas of expertise, and language skills. This is exactly the type of individual the Department needs both here and overseas.

Ms. Glick: To that end, and in the spirit of the BusinessWeek ranking, what steps are being taken to attract and maintain a high quality technical and professional workforce?

Mr. Chellaraj: That's a great question. The Department senior leadership, including Secretary Rice, are fully committed to ensuring the Department's workforce reflects the excellence and diversity of America; we want the best and the brightest to come to State, and we are seeking diversity. Now, well-run private companies, as you know, have already realized this and have taken major steps in this direction. Not having diversity is not an option. Look at President Bush's leadership team here at State.

In addition to doing diversity, we are also forming partnerships with many organizations, take part in conferences and gotten our message in print and electronic media. We have diplomat residents in 17 college campuses currently across the country and growing. We identify, counsel and mentor. We have broadened outreach to many minority organizations. We need Arab-Americans, Turkish-Americans, Chinese-Americans, Korean-Americans, scientists, IT professionals.

In terms of the recruiting for the civil service, the Department is one of the most active participants in the President's Management Fellows Program. In FY 2004, we ranked second among overall government agencies for employing the Presidential Management Fellows. We've expanded the Career Entry Program, which is a two-year career development program open to the public, with positions in areas like contract management, personnel management, financial management and other areas and other areas.

In addition, we've done something fairly unique. We have a number of students, interns and career development programs. We have something called a "Stars Program," which is a student program that allows students to work part-time on Freedom of Information Act issues and declassification programs. We have something called CLIMB, which is an entry-level career ladder program for logistics professionals. State really is reaching out to ensure that we have the best and the brightest workforce, and that is why I believe that we are on the Top 10 list.

Ms. Glick: It is fantastic, and it's quite an accomplishment. Attracting employees is important, retaining employees is important. How do you ensure that your employees have their appropriate training and skills to do their jobs? What's your organization doing to ensure that it has the right staff mix to meet the upcoming challenges that will be faced by the Department of State?

Mr. Chellaraj: Bonnie, the Department established a civil service training continuum, which is a tool designed to be a career planning roadmap and a means to ensure that an employee systematically acquires the knowledge and skills needed for successful performance from entry-level to senior-level.

In addition, we have identified certain types of trainings as mandatory for all employees, or in some cases specifically for employees at a grade level. Give you some of these examples: computer security awareness training, mandatory leadership training, equal employment opportunity diversity awareness. Our Bureau works with our colleagues at the Foreign Service Institute to develop and teach a variety of courses; both classroom and distant learning courses, on topics such as emergency preparedness, grants management, procurement.

I mentioned the Management Immersion Program that we have sponsored. I personally encourage and support our own staff to participate in external training opportunities such as the Department of Defense National War College and the Department of Agriculture leadership programs. One of our own special assistants will start at the National War College this August.

Mr. Morales: Raj, there's an ongoing discussion around government, and even in the private sector, about the pending retirement wave. How are you preparing for this within your organization?

Mr. Chellaraj: Sure. Happy to address that. Along with the rest of the federal government, this is an important human capital issue at the State Department. As part of the Department's broad succession strategy, we have developed numerous initiatives and programs designed to ensure we have the right number of people with the right skills to carry the Department's mission.

The Foreign Service system, which is roughly 60 percent of our workforce, is an up or out career system. Higher-level positions, needs will be met by those already in the system through promotion and seasoned employees according to anticipated needs at each level. With the civil service currently -- 14 percent or so of our civil service workforce is eligible to retire, and by 2010, nearly one third of our civil service workforce will be eligible to retire. This is a fairly sizable challenge for the Department of State.

To prepare for this, we've undertaken several initiatives under the leadership of the director general. The Foreign Service Institute School of Leadership and Management Development ensures the leadership training is part of every employee's career path. We project that by the end of the first quarter of 2007, 100 percent of the State Department's target population of roughly 7,000 mid-level employees will have completed this program.

There is the Senior Executive threshold seminar, which is a mandatory 2-1/2-week course for employees newly promoted to the Senior Executive Service or the Senior Foreign Service. Mentoring is also emphasized in the Department, both for our civil service employees and Foreign Service employees. Our own Bureau of Administration also promotes and encourages using individual development plans for our employees.

The individual development plans, or IDPs, as they're known, is a statement of long- and short-term career goals and development objectives that provides a systematic approach to the training needs of employees. By planning needed training and experiences in consultation with their supervisors, employees are better able to develop the knowledge, skills, and abilities to contribute to the organization in achieving their career goals, and more importantly, meeting the Department's mission.

Mr. Morales: Raj, we're coming to the end of our time, but I want to ask, given your diverse and highly successful federal career, what advice would you give to a person who perhaps is considering a career in public service?

Mr. Chellaraj: That's a great question, and that's a great last question. First, I highly encourage everyone to work in the public sector. The government needs innovative, dedicated and energized people. As you consider what you want to pursue, I would remind your listeners do what you're really passionate about. This may mean your career follows a non-traditional path; it certainly has for me. When I started my career, I did not plan to be the Assistant Secretary of State for Administration. Lastly, I would also say work hard, do your job well and you will get recognized and rewarded.

Mr. Morales: That's fantastic advice.

We have reached the end of our time. I want to thank you for fitting us into your busy schedule, but more importantly, Bonnie and I would like to thank you for your dedicated service to our country across the various roles you've held in our government.

Mr. Chellaraj: Thanks again. It's been a delight being here. In summary, as you can see, we in the Bureau of Administration touch a lot, we work hard at making diplomacy work better. And thanks again for the opportunity to speak to your listeners and share with them our mission and programs. I'd encourage our listeners to look at www.state.gov for very timely information relating to the Department of State.

Thanks again, it's been a pleasure.

Mr. Morales: Great. Thank you.

This has been The Business of Government Hour, featuring a conversation with Raj Chellaraj, Assistant Secretary of State for Administration at the U.S. Department of State.

My co-host has been Bonnie Glick, project executive within IBM.

As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who can't hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.

For The Business of Government Hour, I'm Albert Morales.

Thank you for listening.

This has been The Business of Government Hour. Be sure to join us every Saturday at 9:00 a.m., and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's conversation.

Until next week, it's businessofgovernment.org.

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Welcome to The Business of Government Hour, a conversation about management with a government executive who is changing the way government does business.

The Business of Government Hour is produced by The IBM Center for The Business of Government, which was created in 1998 to encourage discussion and research into new approaches to improving government effectiveness.

You can find out more about The Center by visiting us on the web at businessofgovernment.org.

And now, The Business of Government Hour.

Mr. Morales: Good morning. I'm Albert Morales, your host, and managing partner of The IBM Center for The Business of Government.

Challenged by the administration, federal agencies have sought to identify new and smarter ways to do business and move toward a government that is citizen-centered and results-oriented. To be successful in this area, federal agencies require support and assistance, and the U.S. General Services Administration, or GSA, through its Federal Acquisition Service, works to provide that support. It's taking a leadership role in reducing wasteful government spending.

With us this morning to discuss his organization's leadership in this effort is our special guest, Jim Williams, commissioner of the Federal Acquisition Service within GSA.

Good morning, Jim.

Mr. Williams: Good morning, Albert.

Mr. Morales: Also joining us in our conversation is John Nyland, managing partner for IBM's Public-Sector Global Business Services.

Good morning, John.

Mr. Nyland: Good morning, Al.

Mr. Morales: Jim, before we get started, could you set some context for our listeners by providing us a sense of the history and mission of the U.S. General Services Administration, or GSA? Can you tell us when it was created and what its mission is today?

Mr. Williams: I would be glad to, Al. GSA was created on July 1, 1949, and it was an act signed by Pres. Harry Truman, the Federal Property and Administrative Services Act. It was really a result of the Hoover Commission. The Hoover Commission looked at what do we need in government to make government more effective, more efficient, stop all the duplicative waste that was going on. So GSA was created as a central procurement agency, and really created to help dispose of wartime goods and things like that.

Mr. Morales: Jim, perhaps you can give us some more particulars about the organization in terms of how GSA is organized, the size of the budget, number of employees, and the geographic footprint that you cover.

Mr. Williams: I'd be glad to. GSA has about 12,000 employees, and we have 11 regional offices in places like Boston, New York, Atlanta, Fort Worth, Chicago, Kansas City, San Francisco, Seattle, and the National Capital Region, and I think I named them all. We have a $17 billion budget, and that's pretty much the way we're set up with two different services. The Public Building Service, and think of the nation's landlord, an organization that controls about 8,300 either owned or leased federal office buildings. That accounts for about $500 billion in assets. And then the other half of that, the other service, is the Federal Acquisition Service, which I'm the head of, and that is a service which is the first service in the history of GSA established in law -- last October 2006 actually, in the GSA Modernization Act. And that's a combination of two prior services: the Federal Technology Service and the Federal Supply Service.

Mr. Nyland: So Jim, now that you've provided us with a sense of the larger organization, perhaps you could spend a few minutes and just tell us about your specific area and roles as the commissioner of the Federal Acquisition Service within GSA. So kind of what are your specific responsibilities and duties? And can you tell us about the areas under your purview and how you support GSA's overall mission?

Mr. Williams: Sure, I'd be glad to, John. GSA is a central acquisition agency. We like to think of ourselves as the premier acquisition agency in government. And the way it's set up under the Federal Acquisition Service, my organization, we have four business lines. First, we have one called Travel, Motor Vehicle, and Card Services, headed by Assistant Commissioner Bill Webster. And that looks at many of the things that we do in those arenas, such as charge card services. Three million users spend about $27 billion a year with about 92 million transactions.

We also have our Fleet Program is under that, and our Fleet Program leases about 200,000+ vehicles per year; very proud of the work they do around the world. We have over 1,000 vehicles in Iraq right now.

We also have our Automotive Program, that we are the federal government's buyer of vehicles, and we buy about 65,000 vehicles a year in addition to those 200,000 that we lease.

Our next one is our General Supplies and Services, and under that, we have three different parts. We have our Global Supply Program, which is really an integrated supply chain that provides support to the warfighter, the firefighter, and the everyday government office worker around the world. We also have property disposal, which we do a lot of, hundreds of millions of dollars of property that agencies no longer need, like the commercial trailers that we've helped to dispose of. And we have a guy heading that up, Dave Robbins does a great job there. Our overall assistant commissioner is Joe Jeu, who is just a fantastic leader for GSA. We also have our Integrated Technology Services organization headed by Assistant Commissioner John Johnson. And this is an area where they enter into large contracts such as Networx, Alliant, SATCOM-II, Fed Relay, and they also have all of the other GWACs plus the IT 70 Schedules, and we're very proud of John for that.

Our fourth business area is Assisted Acquisition Services, headed by Assistant Commissioner Mary Davie. And that's an area where agencies actually come to GSA for assisted services, where we actually help them throughout the life cycle, whether it's doing an acquisition strategy or requirements development, doing the acquisition. And we know every agency is struggling in their acquisition mission today. We're there as a force multiplier, as a workload balancer. If your budget is shooting up for next year, do you want to hire all those people permanently? Instead, come to GSA, and these people really take a lot of pride in the assisting work that they do.

Mr. Nyland: So regarding your specific responsibilities and duties, what do you currently see as kind of your top three challenges that you face in your position, and how are you going after these challenges?

Mr. Williams: Well, I would say my top three challenges are, first of all, we're a service organization, and our first commitment is to our customers. And when I talk about our customers to our people, I always say that we have two customers: the agencies that we support, whether that be federal, state, or local, trying to make them more effective and efficient in their missions; and our second customer is the American people. There used to be in our global supply organization that when something was shipped that GSA bought, it used to say, "When you use GSA, America saves money." That customer challenge is always in front of us to do a better and better job for the customer.

Secondly, I would say it's to our people to make sure we're a great place to work. I talk to our people all the time, that my philosophy is I believe in people and results in that order; that if you create the right environment for people with the right leadership, give them the right training, the right tools, the right processes, get out of their way and they will produce results every single time.

I think the third challenge, John, beyond the customers and the people, is our financial challenge. We are an organization that does not get appropriations. We exist based upon the fees we collect for the services we provide. Our customers almost always can vote with their feet, so we have to prove ourselves every single day. And in doing that, we have to manage all of our internal costs very, very judiciously.

Mr. Morales: Jim, now, you talk about 28 years in government. And last time we spoke to you on the air, I believe you were over at DHS, and you've also spent some time over at IRS. Could you describe for our listeners, refresh them, on sort of your career path? How did you get started?

Mr. Williams: I got started in procurement, which I learned to love. And having a business background, business undergraduate and later an MBA, it's something that I just thought used all my business training. I've been in government, as I said, Al, 28 years. And I've been in, I think, depending upon how you count, 10 federal agencies. My wife says I'm a migrant worker, and I think people follow different paths in their career. Many people at GSA have been there their whole lives. I like the challenge of going to new places and reinvigorating myself in every place.

I was lucky to work at places like Department of Commerce, which I loved. The Internal Revenue Service, I spent 12 years there in a place that believes in integrity above all things, which I loved. I was literally yanked over to Department of Homeland Security. And I know people talk about it as being chaotic and dysfunctional, and I think, you know, you can say, yes, it is, but I will tell you the people there are so incredibly dedicated, I loved working at Department of Homeland Security. I loved the people I worked with, I loved the mission, and I loved coming back to GSA. So I've been very fortunate in my career.

And I guess I've moved around partly by choice and partly not by choice, but I've been happy every time. I always reflect back on a deputy commissioner we had at IRS. When he was retiring, they asked him about his career and he said, well, simply put, I've done important work with good people and that was enough for me. And that's what I always say, too. I really believe we are the greatest country in the history of the world, and I love being a part of keeping this country strong.

Mr. Morales: Well, that's certainly a great set of broad experiences. So as you kind of reflect back on that career, how have these experiences prepared you for your current leadership role and perhaps shaped your management approach and informed your style?

Mr. Williams: Well, I've had some just absolutely outstanding bosses, and I think you learn a lot from those great bosses. I think you learn a lot from the really bad ones, too, and I've had a couple of those I guess along the way. But in terms of what I've done in my career, I spent the first 20 years or so in the procurement community. And then when I was at IRS, one of the great, great leaders I worked for, Charles Rossotti, the commissioner of the IRS, asked me to get involved in the IRS modernization and program management. And I went to see him one night saying, look, I really have a great job for you now, and it's about 7:00 at night, and he said have a seat and let's talk about it. About 8:20 that night, I said where's the hill, sir? I'll take it for you. And he's just, you know, one of the greatest guys, brilliant, and just an incredible leader, and I got involved in program management.

And then I went over to DHS, where I was kind of pulled in to head up the US-VISIT Program as the program director there. But there, I used GSA as a customer of GSA.

When I was called, I didn't know Lurita Doan at all, never met her before, before somebody called and said would you be interested in meeting her, talking about this job? And I said at the time, that was the only job I could think of that would cause me to leave Department of Homeland Security. Being the commissioner of Federal Acquisition Service, I felt like the stars aligned and this you know, being involved in program management, having worked for GSA twice before, being involved in acquisition, I jumped at the chance. And the first time Lurita and I talked, we quickly agreed how much we liked GSA, what we thought GSA's role should be. So I was very happy that I came back to GSA.

Mr. Morales: That's great.

What is the value of a central provider like GSA and its Federal Acquisition Service?

We will ask Jim Williams, commissioner of the Federal Acquisition Service, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jim Williams, commissioner of the Federal Acquisition Service.

Also joining us in our conversation from IBM is John Nyland.

Jim, could you talk to us about the value of a central provider such as GSA? What are some of the benefits of having this type of an organization?

Mr. Williams: Well, first, Al, I think the Hoover Commission got it right a long time ago when they saw the need for a centralized procurement agency. And really, you want to leverage the government's buying power, you want to leverage the government's expertise in particular areas, and really take the burden away from all of those agencies to have to set up their own centers of expertise, use their own scarce resources to buy those common supply services and solutions that GSA can buy for them. And leveraging that buying power is one of the advantages. Leveraging the acquisition expertise is another. But let me give you another one that I don't think people thing about enough, and that is leveraging a single interface between the government and the private sector.

I think what GSA does, particularly in its GWACs and schedules, the government-wide acquisition contracts and the Schedules Program, is we create an interface for entry into the federal marketplace. And I think it's the lowest cost entry into the federal marketplace, meaning a company that gets a GSA Schedule under a GWAC can then sell to everybody else in the federal government. And by keeping that low-cost entryway into the federal marketplace, we make it easier for large, small, small disadvantaged, service-disabled vets, all of those companies, woman-owned business, to gain entry into the federal marketplace, creating a broader industrial base.

Secondly, what we try to do, also is by optimizing that interface through standardized processes and electronic tools, we lower the transaction cost. So if a federal agency needs to buy something, first of all, they have a source or an interface to that private-sector provider where they can get something. We actually believe using things like our electronic tools, like GSA Advantage or combined with GSA e-Buy, more and more I think we're trying to move towards the government acting as one, the need for interoperability and information sharing. And by making things more into a common infrastructure, a common set of platforms that allows for similar standards and similar platforms across government, we facilitate that information sharing, that response to manmade or natural threats. And GSA can buy all of those common things and take that burden off agencies.

Mr. Morales: Now, Jim, you used terms such as "schedules," "contracts," and "GWACs." Could you give us a sense of the kinds of contracting vehicles and approaches that are available? And what business needs and approaches best fit these types of vehicles?

Mr. Williams: Well, I think we try to do things that meet all of our federal customer needs. I mean, GSA Schedules just reached an all-time high last year of 34.9 billion, up slightly from the year before. And then that is such a tremendous way to do business with the private sector. Again, with the 15,000 contractors we have on schedules, with 11 million products, I think agencies can get almost anything they need through those. But if there's more than that they need, we have things like our Alliant, which is for IT support services. And I think our people have done a great job with that, which, different from schedules, allows you to use any type of contract cost reimbursement or anything. And again, we're verifying the suppliers. We did a great job of scrutinizing, making sure we picked companies who we knew would deliver for our customers.

Mr. Nyland: So Jim, help us out a little bit with some of the terminology. What are the specific differences between the GSA Multiple Award Schedule contracts versus Government-Wide Acquisition Contracts, or the GWACs, and then the multi-agency contracts? And more specifically, kind of what's your sense of their overall effectiveness?

Mr. Williams: Well, the difference between a GWAC, Government-Wide Acquisitions Contract, and a MAC, a Multiple Award Contract, is the GWAC was set up in law as something under the Clinger-Cohen Act, where you get a specific delegation of authority for a GWAC. A MAC can be for something other than information technology that, again, is available government-wide. And we have all three. And as we've come together as the Federal Acquisition Service, we want to make sure we eliminate any unnecessary overlaps. There may still be overlaps because of different needs.

And generally with all of those, the GWACs, the MACs, and the Schedules, those are things where agencies go directly to those vehicles for support and then they pay us a fee. And those are kind of our direct channels where you don't go through GSA. You go directly to those sources of supply.

You can also come to us, our Assisted Acquisition Services, where you need that help, project management, financial management, and program management, to actually help you do the buying against either those particular contracts, the GWACs, MACs, and Schedules, or even we help people using their own internal contracts, as we've helped out agencies like Department of Defense and Department of Homeland Security.

Mr. Nyland: Now, GSA and the Federal Acquisition Service have made some significant management and financial changes to kind of the procurement operations over the last five years. Can you elaborate on some of these efforts? And how have these changes enhanced accountability, transparency, and delivery of services to customers?

Mr. Williams: GSA's Federal Acquisition Service is a result of a merging, or reorganization as some people call it, of the Federal Technology Service, which think of Networx and Alliant, and the Federal Supply Service, think of GSA Schedules. I call this something that is the creation or the establishment of a new service. It's an opportunity and an obligation to do something I think new and great for this country. And I look at it as how do we make GSA that strategic sourcer that can help federal agencies be more effective and efficient in spending their taxpayer dollars and making those taxpayer dollars go a lot farther. And certainly with the money we're spending to spread freedom and democracy around the world, we're going to have budget challenges for years to come, and every taxpayer dollar is precious. And I'm trying to create a system that is -- not only involves competition, it involves all those things that you care about in the private sector in terms of public accountability.

But the first and foremost goal of procurement is to meet the mission and meet it in an effective and efficient way. And that's what I'm trying to create, a foundational system that'll facilitate that.

Mr. Nyland: Given your organization's mission, what has the Federal Acquisition Service done to enhance and transform its customer service capabilities? So -- you know, does one GSA, one voice capture the intent of your integrated approach seeking to produce greater value for customers? And has it brought your organization closer to realizing its vision of one face to the customer?

Mr. Williams: Well, I think we're working towards that. When you look at trying to create something new, you know, I'd like to push a button and have it happen tomorrow. But in terms of being focused on the customer, I think a few years ago, GSA -- unfortunately, we were in some turmoil trying to create the Federal Acquisition Service, looking inward at some problems we had, and maybe back then we lost the focus on the customer. When we talk about what our principles are, they are service innovation and value, and that's what we live and breathe, and that first thing is service. And there's a reason why it's called the General Services Administration and the Federal Acquisition Service.

I love doing work for customers, and we have a customer accounts and research organization headed by Gary Feit. But that organization does a great job in understanding our customers' needs and giving us that feedback loop that tells us where we should be going to better serve the customer. And it is something where we have to come together continually as an organization.

We're not a large organization. I think the Federal Acquisition Service is just under 4,000 people, but we're spread around the world, nationwide in our 11 regions. And my job is to really get the right people together to make sure that we set out the right vision as a team, we work as a team, we focus on the customer to make sure we know what they need and we can provide it and always keep ourselves on edge. So, you know, mostly, John, I would say it's around getting the focus straight, the focus being service innovation and value, and doing those things that, first of all, get the right people. Start with people and then focus on a system gets -- the people, the processes, the technologies, get those all working together.

We have four business lines, but we also have these other organizations: our customer accounts and research, our controller, our chief information officer, our acquisition management, and our administration. Those are the people I kind of termed "our integrators" as we're trying to come together. They're going to optimize what we have to do, and they're going to make sure that everything they do supports coming together to better serve that customer, because we have to keep our fees as low as possible and we have to keep our processes and tools on the forefront. I mean, that's critical for agencies who make the decision whether to use us or not.

Mr. Morales: Now, Jim, earlier you mentioned the President's Management Agenda, and certainly here on the radio show and at the Center, we spend a lot of time analyzing the effects and results of the PMA. Can you tell us about the PMA objectives for e-government and the results that have been achieved to date? And specifically, what role does your agency play in the success of this initiative?

Mr. Williams: Well, first of all, I have to say I am a huge fan of the President's Management Agenda. I think it is exactly where this government needs to go for all the reasons I said before in terms of bringing together one government. Being a better manager in the President's Management Agenda has five key elements, e-government being one of them. And in the e government arena, I think GSA plays a particularly large role.

First of all, we have an Office of Governmentwide Policy who works very closely with OMB to help implement the President's Management Agenda, especially in the e-government area. My particular organization, we do things like e travel, where we now have 100 percent of all of the agencies signed up, all of the civilian agencies, on the same e-travel system. And again, that's one of those common platforms. We are involved in the financial management line of business, the HR line of business, and all these things are about, again, to me, trying to make the government a better manager of the taxpayer dollars, putting out those common platforms.

And one of the things they don't talk about as we try and make financial systems more common and HR systems more common and an e-travel system something common across government, as somebody who's worked in, as I said, maybe multi- or as much as 10 different federal agencies, when I go from agency to agency and I see a different system every time I go someplace, frankly, that doesn't facilitate a robust 21st century workforce. I mean, so many of our issues are now enterprise-wide across boundaries. We ought to have a more flexible workforce so people can move around.

I'm a big supporter of the President's Management Agenda through our e-travel, our federal assets sales. We're one of the four key organizations that have been designated by OMB to be a property disposal agency for personal property. We're the only ones that do it for all facets of federal asset disposal. As I said, the lines of business, we're involved in all of them.

The Infrastructure Technology Initiative, trying to look at consolidating and saving money in infrastructure, we're getting very involved in that and very proud to do so.

Mr. Morales: That's fantastic.

What about GSA's recent Alliant Government-Wide Acquisition Contract?

We will ask Jim Williams, commissioner of the Federal Acquisition Service, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jim Williams, commissioner of the Federal Acquisition Service.

Also joining us in our conversation is John Nyland, managing partner for IBM's Public Sector Global Business Services.

Jim, with having more than 10,000 contract holders on your GSA Schedule contracts, how has the organization streamlined its e-procurement program and eased the administrative burden on your employees?

Mr. Williams: I would say through several ways, Al. First of all, when our administrator came in, immediately, she gave me a 30-day challenge. How do you look at taking particularly small business companies who want to get on a Schedule and how do you reengineer your processes to get it down so that it didn't take what it was at the time, 120 days or so, get it down to 30 days or less to get a GSA Schedule contract. And we've looked at not sacrificing quality, but how do we look at our processes.

We're doing the same thing with Mike Sade, our assistant commissioner for acquisition, is looking at our modifications process. We want to be able to -- for companies to be able to add products and services quickly to their existing Schedules, again without sacrificing the job that we have to do to verify it's still a good company, still great pricing.

He's also combining it with our CIO, Ed O'Hare. There, we're trying to merge the changes in the process to the advances in the enabling technology. And Ed is looking at further taking GSA Advantage, which we've already taken GSA Advantage, and it's customized for our agency customers. There's Air Force Advantage, afadvantage.gov, vaadvantage.gov. And something else that Ed is doing is combining that with e-Buy and e-Library. E-Buy is where you can go on and electronically post request for quotations and get back electronically the offers and bids and then award it. E Library is a research tool. And Ed's trying to bring all three of those together. And he actually just did this not too long ago with the VA, with VA e-Connect, where he put out e Buy with this e-Connect with a service-oriented architecture that allowed agencies to be able to embed part of that e-Buy capability into their existing system. Again, making that transactional cost not only quick, but being able to lower the transaction costs that agencies always have pressure to do something quick and to spend those taxpayer dollars wisely and to make sure it's good quality. And we do all of those things.

Mr. Morales: Jim, now, in the last segment you touched upon GWACs and Alliant. Could you elaborate a little bit more on the benefits that you expect to provide your customer agencies with the establishment of the Alliant GWAC?

Mr. Williams: Sure. I'm very proud of the job that our people did on Alliant, mostly because they went out and really listened to the customers out there. And Alliant is really a replacement vehicle, in a way, for previous vehicles like Answer and Millennia, but it's different. Again, as I talked about earlier, Alliant was structured around both the federal enterprise architecture and the DOD enterprise architecture, so you can look at buying things that are consistent with different segments of those enterprise architectures.

I think the other thing they did was maintain very high standards with Alliant. Even with GSA Schedules, we go out and verify those suppliers. We don't just award a contract and turn our head. We have people go out and check to make sure that these contractors are delivering the way they're supposed to.

On Alliant, we set very high standards for -- we wanted established companies. We wanted cost accounting systems that were established, because if they're going to be doing cost reimbursement, time and materials, or any type of contract, we want them to have a solid performance record, solid accounting systems.

those out there, because we find that an agency, in talking to customers, when doing their job may want to start with a company that maybe designs a system. Do they want that company to also develop it? And that doesn't necessarily involve a conflict of interest if the agency is managing that. But if they want to go to one company for the whole thing, they're not constrained by other agency vehicles that might have domain restrictions or functional area restrictions. We eliminated that to make sure we did what our customers wanted. So we're very proud of what Alliant is and what it can do for agencies.

More than that, as I said, we have I think done a great job in choosing great industry partners. And we know that we really want to get this program growing, you know, that OMB wants us to do this. Because, again, it tells agencies here's a vehicle that allows you to do things consistent with the federal enterprise architecture and the DoD enterprise architecture. I think it's a super Government-Wide Acquisition Contract, or GWAC, for agencies to use.

Mr. Morales: Now, do you expect the civilian agencies and the DoD to be equal users?

Mr. Williams: Well, I think, you know, a lot of the civilian and DoD agencies have spent time creating their own vehicles. And I wish they hadn't, because they have scarce acquisition resources. For them to do that, they have created yet another interface to the private sector. And when you look at what GSA does, if you can get it through GSA, why would you do it anywhere else? And I love the words of people like Lt. Gen. Charlie Croom, who says, look, I don't want to create something if I can buy it elsewhere, the head of Defense Information Systems Agency. And I think all agencies should think in a statesperson-like way, like Gen. Croom, to say why should I recreate this? Because when you create it, you're taking scarce acquisition resources and putting them into something that is duplicative.

Mr. Nyland: So Jim, GSA and its customer agencies are preparing to transition to a new government-wide telecommunications contract known as Networx. Could you elaborate on the Networx program? And how do the advanced technologies and services that are defined in this program serve as a platform to transform the government's telecommunications infrastructure to a more seamless and secure environment?

Mr. Williams: Well, John, first of all, I would say Networx is something I believe is a transformational vehicle, and I'm really repeating what Assistant Commissioner Johnson says all the time. If you look back in time, when this started as FTS 2000, it was really a replacement for a dedicated network. It talked a lot about the convergence of voice data and video. But frankly, it was really a lot about lowering that price of the voice calls at that time.

I think going from FTS 2000 to FTS 2001 to Networx -- and surprisingly Networx is not an acronym, it is N-e-t-w-o-r-x, but it is really a unique vehicle, the largest telecommunications award in the history of the federal government as far as we know. But it is something, if you look at the services that are underneath that, as I said earlier, this is the ability to not just look at your buying carrier services, you're looking at a transformational vehicle and you look at the ability to take advantage of Internet Protocol Verion 6, IPv6, or a voiceover IP. I mean, that's where agencies are going, and the ability to use even the managed services that are under Networx.

All agencies are facing challenges in having the right kind of people to manage a conglomerate of different network services. What we look at Networx is eventually is a capability to deliver broadband to the desktop and really to provide the transformational vehicle where agencies can look at how can I accomplish my mission differently and how can I do that through a common platform of networks? And again, agencies can either manage their own networks or choose the network services portion of Networx. I think it's a tremendous vehicle.

Mr. Nyland: So of late, there's been a lot of effort towards a government-wide standard for a secure and reliable form of identification for employees and contractors. Can you elaborate a little bit on the Homeland Security Presidential Directive 12, commonly referred to as HSPD-12? What are some of the key requirements, and could you tell us about the services your organization offers in this area to agencies?

Mr. Williams: Sure, John, I'd be glad to. I mean, looking at Networx as trying to have everything be seamless, secure, and electronic communications, you then look at how do you identify people. And HSPD-12, Homeland Security Presidential Directive 12, is really looking at how do you establish a common credential as well as a common vetting system, something if you look across the federal government probably should have been done 50 years ago. And certainly the President in 2004 signed this as a result of September 11th, but it's critical that we do this.

And at the Department of Homeland Security, Deputy Secretary Admiral Loy used to hold up a truck driver's 17 different ID cards. Well, I think you've actually seen people walking around with multiple federal credentials and that's not good for security and it's inefficient. And somebody, as I said, who's moved around in my career, to have to go get myself re-vetted when I step somewhere on a Friday to a new location, or a Monday, and they tell me my security clearance has to be redone, it really doesn't make any sense. And I think the ultimate dream of HSPD-12 is, first of all, have a common vetting system that is secure, so that when you get a credential, it is based upon a secure supply chain of source documents, not built, frankly, on a potential house of cards, then to get that credential that eventually could be used in an interoperable manner for both physical access and logical access. I mean, that's really where we should be going.

Again, that creates a common platform for a more interoperable set of credentials across government. Our role in that, we're very proud of the PMO, the Program Management Office, we now have about 67 agencies that we're supplying that credential to. I think it encompasses about 850,000 credentials. And we're proud of the very first deadline back in 2006, where we were the only organization, our Program Management Offices, to produce NIST FIPS 201 compliant cards. We're very proud of that, but we know we have to continue to deliver because we have another deadline coming up in October of 2008. We worked very closely with Karen Evans at OMB on this to make sure that we are in sync with where they want to go.

But this is something beyond just making good economic sense in terms of, you know, the common vetting system, the common credentials. It's important to the security of the nation. So we're proud of the work we're doing in HSPD-12.

Mr. Nyland: Let me switch gears a little bit and now talk about IT infrastructure. You know, in a period of static or even decreasing federal IT budgets, the cost of maintaining existing federal IT infrastructure is rising at a faster pace than information technology as a whole. As a way of seeking to realize cost savings by optimizing IT infrastructure, can you elaborate on the IT infrastructure line of business? And how will it lead to IT infrastructure consolidation and optimization and assist us in the development of a government-wide common solution?

Mr. Williams: Well, again, John, I think this is a great OMB presidential initiative. And if you look at where Karen Evans is trying to go, and she works with our Office of Governmentwide Policy on this, and a leader named Von Harrison, who does a great job on this for GSA, and we're working with that interagency committee from the Federal Acquisition Service to make this a reality.

And if you look at that, as you talked about, that infrastructure initiative, I think they've broken down infrastructure into three parts: the end-user systems and support, the mainframes and servers systems and support, and the telecommunications systems and support. All of those are common platforms. All of those are opportunities where we could save as much as 25 or more percent off that growing percentage of our IT budget. And I think the fact that it's growing, in a way, may not be a bad thing. Because, again, moving more and more things into a common infrastructure is a good thing, because it means you're optimizing by using something that's common, a common infrastructure, versus everybody doing their own thing. That's not a good thing.

But if you look at just things like our data centers, I heard recently our data centers consume 1.5 percent of the total power in the United States. And I think there's an opportunity to put everybody on this common platform. If you think about a common platform from the end user to the mainframe servers to the telecommunications, again, that will facilitate information sharing and interoperability. And the savings in terms of going green and energy efficiency, the things that we can do with that infrastructure at the same time can just save a ton of money with tremendous benefits.

And I think what we're looking at, the initiative that's there right now, is to put everybody on a common set of metrics. And take those metrics and compare them to common industry of private-sector metrics. And then look at how do you -- you know, where you are in terms of your metrics of performance and cost efficiencies today. Where do you have to be? And then how do you get there? And I think, you know, one way to get there is through consolidation. All agencies have different legacy systems, different challenges, but trying to get them -- to give them the goal of you need to save money and improve performance. And then how do they get there? What GSA, my organization, wants to do as we're partnering with the Office of Governmentwide Policy and OMB, is be ready with those kinds of offerings that can provide the opportunity for agencies to get there.

We just recently added on a Schedule A company that offers data center services at the Top Secret/SCI, sensitive compartmented information, TS/SCI level. And I think where agencies are moving is looking at they want security. Absolutely, security is paramount. But they don't want to own everything anymore. They want to look at how do I buy services? And how do I get myself moving up that scale to meet the metrics of the private sector or better? And how do I save money? Consolidation is one way. Changing the mindset of what you're buying, not buying the bricks and mortar, but buying the service and making sure the service is going to be there when you need it. And it's going to get you in terms of the cost efficiency that we want to get to the private sector or better.

So I think the first goal is get them on a common set of metrics, measure them against the private sector as a benchmark, and then look at ways to give people the goals of saving money. I want my organization to be there to help out with those offerings that help out with the environmental, the energy initiative, and just provide those services that the agencies need and across the spectrum of the infrastructure of end user to mainframes and servers up to the telecommunications. And I think with the telecommunications, Networx is a key component of that today, SATCOM-II, and there are other pieces that we do in that area.

Mr. Morales: Now, Jim, in this area of services, we're seeing an increasing mix between government employees and contract employees. I only have a minute left, but from your perspective, could you tell us how federal managers can effectively manage this ever-increasing blended workforce composed of both contractors and federal workers?

Mr. Williams: Well, I think that is a tough challenge, Al. And being a former program manager, I experienced that challenge. First of all, the government's always the customer. And the government has to be able to know -- be a smart buyer and they know their mission better than anybody.

I think that partnering with the private sector, I think, is -- there's been wonderful successes in partnering with the private sector. And those successes come about when you work as a team. And it's often a challenge because you have a contract in the middle of it and you want to have the private sector have accountability. But frankly, when you get into some of these larger programs, it's joint accountability. You succeed together or you go down in flames together. So I think you want to find a way to structure the role of the contractor as a partner with the government. But, at the same time, the government is 51 percent of the vote always and the government has to be smart about what their mission needs are.

And I like partnership with the private sector. It brings what I hope is the blend of best practices from the private sector. Because certainly they service a lot of other customers besides the government, and it brings that mission knowledge of the government agencies. When you it's like anything else in life. If you can bring a team of people together, get them focused on a common goal, the results are just tremendous.

Mr. Morales: That's fantastic.

What does the future hold for GSA and its Federal Acquisition Service? We will ask Jim Williams, commissioner of the Federal Acquisition Service, to share with us when the conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Morales: Welcome back to The Business of Government Hour. I'm your host, Albert Morales, and this morning's conversation is with Jim Williams, commissioner of the Federal Acquisition Service.

Also joining us in our conversation from IBM is John Nyland.

Jim, you finished the last segment by talking about how some of the best programs are accomplished by teams of employees. Could you elaborate a little bit more on your approach to empowering your employees? How do you lead change and enable your staff and those within the organization to accept the inevitability of change and make the most of it?

Mr. Williams: I think I was lucky to have some experience with change at the Internal Revenue Service under Charles Rossotti when he really undertook a massive change there at IRS. And then joining from there Department of Homeland Security, which I can't think of a bigger change in government in the past 50 years than the creation of the Department of Homeland Security. And I think change is -- it's a cliche, but it is constant.

When I came into GSA, again, they were a little bit, I think, trying to finalize the establishment of the Federal Acquisition Service. What I first tried to do is articulate, I think, a vision for where I think GSA ought to be going. And that vision involves focusing on the customer, being that provider of the common supply services and solutions that help the warfighter, the firefighter, the government office work, meet their needs, providing that foundational acquisition system all the way through from helping agencies with setting up vehicles for them to use or helping agencies actually buy, to helping them dispose of property or manage their fleets, programs, things like that. And then getting the right set of stable leaders in place.

And then, frankly, the change is something, as I see it, as a refocusing. Again, focusing on the customer. Focusing on being internally efficient. Focusing on creating a great workplace.

Mr. Morales: So along similar lines, Jim, we get to ask most of our guests about collaboration. And so I'm curious, what kind of partnerships are you developing now to improve your operations and outcomes at GSA? And how do you envision these partnerships perhaps evolving over time?

Mr. Williams: Well, Al, I love partnerships. And I think I had great partnerships at Homeland Security with my friends at the FBI, Tom Bush, and my friends at State Department, Ambassador Maura Hardy. And I just like, as I said before, getting good people together and getting them working together. I think at GSA, we started with a Department of Defense Memorandum of Agreement, how we can improve together. And I think I talked about recently we signed -- I signed a Memorandum of Agreement with Gen. Usher, the deputy commandant of the Marine Corps for installation logistics, for us to be his 4-PL, fourth party logistical supplier. We're very proud of that. And the agreement we have with TRANSCOM, Gen. Norton Schwartz, head of U.S. Transportation Command, and Lt. Gen. Dail of Defense Logistics Agency, trying to be that strategic partner and how do we optimize things with our customer agencies. Strategic partnerships are great for us because we can improve our delivery of service and at better pricing.

I think internally, you know, I have a group of people who are the leaders underneath Barney Brasseux and me, and I like to say that, you know, I'm the type of person, I don't like to lead by committee, but I like the best advice of smart people. And certainly, there are people at GSA who know their job so much better than I will ever know, and I like to get them together.

We have something that our Assistant Commissioner Jack Williams, and I'm sorry if I didn't mention him before, for strategic business planning process improvement, he runs our Management Council. And our Management Council is composed of our assistant commissioners, who work directly for Barney and me, and our assistant regional administrators around the country. We get together as a team, and that team were the ones that came up with our principles of service, innovation, and value. And as I've said before, I care about getting good people together and getting the work as a team. So I'm not sure if that's directly responsive to your question, but collaboration is what it's all about. That's how you get things done in government today.

Mr. Nyland: Jim, I'd like to transition now to the future. Can you give us a sense of some of the key issues that are going to affect the Federal Acquisition Service and government-wide procurements over the next year or two?

Mr. Williams: Well, I think there's changes coming with some recent laws that are being passed looking at changing the federal acquisition system, and I think we have to make sure that we provide the proper training and things like that. I think where we're going, GSA, first of all, going green is I think an important initiative for us. And our deputy administrator, David Bibb, is heading that up as one of the key senior federal officials in government on going green. That, combined with energy efficiency.

I think we're also looking at where our customers want one-stop shopping. Another initiative we have within GSA is One GSA. And our latest strategic plan really emphasizes coming together between the Public Building Service and the Federal Acquisition Service. If some agency is making a major move, how do we really provide one-stop shopping in terms of the move and the furniture that we provide and the telecommunications capabilities, and everything so that agency can come to us and have us take care of their needs. And I think that's something we're trying to be better at, to provide that one-stop shopping for our customers.

I'm also looking at how do we better integrate across GSA? There's a great part of GSA, the Office of Communication and Citizen Services, and there's a person there, Martha Dorris, who really is the creator of usa.gov. And they provide services directly to the citizens. They deal with the states all the time. What we're also trying to do is be a better provider to state and local government. When you talk about, you know, the threats or the challenges, whether it's acquisition resources or responding to natural disasters, those exist across federal, state, and local.

We partnered with FEMA to put in place contingency contracting to help them respond to those kinds of disasters. Our Schedules Program is now open for state and local governments for response and recovery purposes. And we did this with the Department of Homeland Security to open up all of our Schedules so that whatever states, if they have a need, they can feel they can come to us.

And I think we saw the benefits of this kind of partnership with FEMA in the recent, not-too-long-ago California wildfires, where we not only had the things to help the firefighter, the supplies they needed to fight the fires, but we were ready with things like meals ready to eat and water. Then we put in place contingency contracts with FEMA to be better able to respond to those kinds of disasters.

So strategic partnerships are where it's all about. And our future is about GSA doing more of those strategic partnerships and really providing those common platforms across government and often being either a provider of services or a provider of the contracting expertise.

Mr. Nyland: Now, Jim, staying on the future, kind of on a broader basis, what are some of the major opportunities and challenges that your organization will encounter in the future? And how do you envision your office will evolve over the next five years or so?

Mr. Williams: I'm not sure. First of all, I hope we'll continue to be customer-focused. I hope we will be there on the forefront of what our agencies need to get them those products and services they need. Hopefully, we'll build better partnerships with our customers and within GSA. Where we'll be five years from now, I think that's pretty hard for any agency or any entity even to predict. But certainly I think you look at where we are in the history of this country right now, where the need to really protect our children and our grandchildren from putting them in great debt really should be a compelling burning platform to say we need to do everything we can to save money. And I think GSA's in the best position to either provide that common service, that common solution, that allows to all of those win-win goals of information sharing, interoperability, and taking the burden off agencies.

Agencies who manage their own fleets today, I don't know why they do it. I don't know why they don't just let GSA do that for them, because we measure customer satisfaction and we get very, very high marks in that area. So I hope that we can become somebody that is relied upon for all of those common things that the agencies need.

And believe me, I am not trying to build an empire. I just believe this is good government. And what I also believe is that we have to be constantly on our toes. And I think we have to look at these opportunities to provide that acquisition system and those services across federal, state, and local. Because, you know, there's not right now a very high level of confidence in the government. I mean, there's -- if you look at some of the ratings, for whatever reason they're not where they should be, you know, down in the teens.

And I do believe, again, we are the greatest country in the history of the world, but that's a very precarious thing. I really believe that. And I believe that GSA as a support agency in the middle of supporting these 100+ agencies in 100 countries around the world, we are critical to the nation's future. And I think we have the right people to do that. Our challenge will be keeping the right people and keeping the right edge in terms of process improvements in technology and processes so people don't have to duplicate what we do. So certainly we're always going to have challenges, and maintaining the financial discipline is something that's a challenge every day.

Mr. Morales: Jim, you've had a very successful 28 years of federal service. As you sort of reflect on your career, what advice would you give to a person who perhaps is considering a career in public service or in the federal government?

Mr. Williams: Well, first of all, I would say do it. I often talk to people in the private sector and say, you know, once you've made all the money you need, come in and work for the federal government. Do something you'll be proud of for the rest of your life. And I've seen that so many times. People have come into government and, first of all, they say, well, I've never worked harder in my whole life, but they've never been more ennobled in what they do because it's such a -- just something that is inside you that feels good about being a public servant. It feels good about helping the United States of America stay strong. I guess the advice I would give, you know, keep up your education. As somebody once said, volunteer for things. Always -- you know, I'm somebody who likes to take on the big challenges. Anything less than that, I'm bored. I probably have only two speeds, which is full speed and dead asleep, and I like multiple challenges at once.

But I think the advice I would give people is the advice I've often -- repeatedly give to young Air Force officers, which is don't think about the next promotion. Just think about the job you have in front of you and do it well. And at the end of the day, you've done it well and that's a good thing. It's a feel-good thing. And usually if you've done it well, somewhere somebody will say, hey, there's somebody who we ought to bring along. Never shirk from responsibility.

And, you know, the government is somewhat different from other institutions where they put a little bit higher premium on integrity and public accountability. I know everybody else does and certainly that's happening in the private sector, but you always want to operate with integrity because it's not your money. It's somebody else's money, and do the best thing for the taxpayer. If you do the right thing and stick to your principles and work hard and give an honest day's work for an honest day's pay, you'll be successful in your career and you will love it. And I've enjoyed it.

I mean, I just -- I always tell people if I couldn't, you know, play for the Boston Red Sox or if I couldn't play in the NBA, this is what I'd choose to do, having been through what I've been through. I love it.

Mr. Morales: That's wonderful advice, thank you. Unfortunately, we have reached the end of our time.

I do want to thank you for fitting us into your busy schedule. But more importantly, John and I would like to thank you for your dedicated service to our country across the many roles that you've served in nearly the past 30 years.

Mr. Williams: Well, thank you very much, Al and John. It's a pleasure being here today, and I hope people will look at GSA and the Federal Acquisition Service as something that is there for them. We try.

Mr. Morales: Great. This has been The Business of Government Hour, featuring a conversation with Jim Williams, commissioner of the Federal Acquisition Service within the U.S. General Services Administration.

My co-host has been John Nyland, managing partner for IBM's Public-Sector Global Business Services.

As you enjoy the rest of your day, please take time to remember the men and women of our armed and civil services abroad who can't hear this morning's show on how we're improving their government, but who deserve our unconditional respect and support.

For The Business of Government Hour, I'm Albert Morales. Thank you for listening. Announcer: This has been The Business of Government Hour.

Be sure to join us every Saturday at 9:00 a.m., and visit us on the web at businessofgovernment.org. There, you can learn more about our programs and get a transcript of today's conversation.

Until next week, it's businessofgovernment.org.

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"Biometric technologies like finger scans are important. Fingerprints have a 96% accuracy rate today. Using biometrics doesn't take away your privacy; it protects it. It protects you from identity theft because nobody else can use your fingerprints."

Mr. Lawrence: Good morning, and welcome to The Business Of Government Hour. I am Paul Lawrence, partner in charge of the IBM Center for The Business of Government. We created the Center in 1998 to encourage discussion and research into new approaches to improving government effectiveness.

The Business of Government Radio Hour features a conversation about management with a government executive who is changing the way government does business. Our special guest this morning is Jim Williams, director of the US-VISIT program in the Department of Homeland Security.

Good morning, Jim.

Mr. Williams: Good morning, Paul.

Mr. Lawrence: Also joining us in our conversation from IBM is Todd Wiseman.

Good morning, Todd.

Mr. Wiseman: Good morning.

Mr. Lawrence: Well, Jim, let�s jump right into it. Could you tell us about the United States Visitor and Immigrant Status Indicator Technology program, or US-VISIT, as it�s better known?

Mr. Williams: Yes, US-VISIT is a program from the Department of Homeland Security, and we really have four goals. One is enhancing security for citizens and visitors, and we always include visitors because we want people to feel safe in coming to United States; facilitating legitimate trade and travel. We know that 99.99 percent of the people coming to the United States come here for legitimate reasons: to study, to travel, to do business, see family, seek medical help, and we want those people to come.

The third goal is to ensure integrity in our immigration system. As the President recently said in his State of the Union address, we want to know when people are coming, and we also want to know when they are leaving. And I often talk about this as, it�s our house. We want people to visit; we want to know why they are coming; we want to know when they are coming; and we want to know did they leave.

And the fourth goal, that's as equally as important as the first three goals, is to protect the privacy of our visitors. As we collect additional information from visitors, we want them to feel safe in terms of giving us that information, that it will be adequately protected.

Mr. Lawrence: When you describe the goals so distinctly, it seems also clear and obvious, but could you tell us the history of the program; what was the business problem that this was designed to -- and how that all came about?

Mr. Williams: Sure, it is a program that was mandated by Congress first in 1996, that�s pre-9/11, aimed at really curbing illegal immigration. It was called in the law the �entry/exit system,� and it was a program under the legacy INS organization, Immigration and Naturalization Service, that really somewhat languished due to a lack of resources. Post-9/11, there were other laws passed by Congress mandating this entry-exit system, really aimed at combating terrorism post-9/11.

Secretary Tom Ridge, on April 29, 2003, as part of his 100-day speech of Homeland Security, grabbed hold of this program. He renamed it US-VISIT, and he chose that name to reflect the fact the United States is a welcoming nation. He also did a couple of other things on that day as part of his 100-day speech.

Number two, after renaming it, he elevated it to report to an Undersecretary, Asa Hutchinson, who is my boss, who unfortunately is leaving government service; an absolutely great leader. He elevated that to reflect the fact that it�s a horizontal program, and it has to deal with many different entities of DHS, and other parts of government.

The third thing that Tom Ridge did on that day was on top of saying we�ll meet the Congressional requirements to be at airports and seaports by the end of 2003, he said we�ll also start to collect biometrics. And biometrics means, for those visitors who are included in US-VISIT, we collect an electronic digital finger scan, which you can see if you go out to Dulles Airport, the international terminal; people come in, we are taking an electronic finger scan, electronic photographs of those people. It takes only a few seconds; it�s easy, but by doing that, we are enhancing security for this country.

Mr. Wiseman: How do you describe, or how do you think about the size of US-VISIT?

Mr. Williams: Well, the size of US-VISIT can be defined in many different ways. One is, if you look at the visitors who cross our air, land and sea borders, it�s about half a billion people a year that come into our country across any one of our over 300 air, land, or sea ports of entry.

And also, you can define it by size. As I said, it�s a horizontal program. You look at the government agencies that are involved in either, travel, trade or immigration, and you look at those different aspects of government, and that includes, just within DHS, it includes Customs and Border Protection, Immigration and Customs Enforcement. It includes Citizenship and Immigration Services. It also includes Department of State, and in fact, we work closely with the Department of Justice, Department of Commerce, Department of Transportation, and that�s just at the federal level.

If we define how far it can go beyond that, we also work very closely with the private sector, and have had great partnerships with people like the Air Transport Association, the Chamber of Commerce, Travel Industry of America, Border Trade Alliance, as well as working closely with other countries. Because what we are really trying to do in the end is trying to improve travel for good people, and make it harder for bad people to travel.

As the 9/11 Commission said, travel documents are weapons in the hands of terrorists, and we need to find a way to take those away from them.

Mr. Wiseman: Can you tell us a little more about your roles and responsibilities as the director, Jim?

Mr. Williams: My role is to direct the program in terms of preparing the budgets, in terms of making sure we can meet the commitments of Congress on time, and making sure that we can deliver things that provide all the necessary benefits. The benefits being in line with our goals, benefits of enhancing security by giving the men and women who use US-VISIT, whether it�s a visa-issuing post in all of the 207 visa-issuing posts around the world, or in all of those ports of entry where we have customs and border protection officers, whose job it is to in a few seconds make a decision whether to admit somebody in the country or whether to deny them entry.

And what we are trying to do is give them a tool in their tool belt that they can use. At the same time, the role is to deliver on the benefits of facilitating legitimate trade and travel. We want to be able to provide for good people to be able to cross our borders a lot easier, and the goal is really to keep people motivated, which, frankly, is not a hard job.

I�m very, very fortunate to work with some incredibly dedicated and super-intelligent and just phenomenal people. Frankly, I never think of this as anywhere near a one-person job. It�s not even within my organization because we work so closely with other organizations. It�s everybody involved in this, a rallying around these external goals. And it�s really just making sure those people have the resources they need. And as we implement this system, make sure we can work with our policy folks; make sure as we implement new business processes and new technologies, they�ll harmonize with the right policies.

Mr. Wiseman: What were your previous positions before becoming the director for US-VISIT?

Mr. Williams: Well, my last job was working at the Internal Revenue Service, for about 12 years, where my last job there I was a Deputy Associate Commissioner, program management for the IRS modernization, which I am happy to say has had some great successes, even last year, rolling out some of the toughest programs in government. And I�m glad that I played a small part in that. Prior to that, much of my career was spent in Federal Procurement, in the acquisition arena, where I was director of IRS procurement. I also worked on major telecommunications procurements at GSA. Actually, it was pretty exciting times when we worked there, because it was right around the time of the AT&T break-up. I worked on FTS 2000 as a first contracting officer in that.

Also, I�ve worked for Department of Commerce on three separate occasions. Sometimes I refer to myself as somewhat of a migrant worker, because I�ve deliberately moved around. I like big challenges, and I like to have to prove myself all over again, and anything�s big and tough, you know, let me at it. So I�ve tried to deliberately move around; not to advance my career, just because I like challenges. I�ve never really planned where I want to be next; it�s just whatever seems to come up. Also, I�ve been involved in procurement of supercomputers, and negotiations with the government of Japan on some trade agreements, which was pretty exciting.

Mr. Wiseman: You mentioned an extensive background in procurement acquisition; how has that experience prepared you for this position, and how do you apply a lot of those experiences, because many folks in your role don�t have nearly the procurement acquisition experience you�ve had?

Mr. Williams: Well, when I look at heading one of these major programs in government, somebody asked me one time, �What�re you looking for?� And I said I really see four legs of the store if you want to define the perfect program manager, which I am certainly not. But number one is, you want to have knowledge of the business; you want to have knowledge of what you�re trying to provide in terms of this service to your eventual customers.

Secondly, I think you want to have knowledge of Information Technology, some basic knowledge of that, because all of these programs are about technology, as I see them. Third is about program management disciplines, which I�ve had some recent experience in. And the third is really acquisition in contracting management. And most of my background is in procurement and contracting, some program management. I�ve been around Information Technology my whole career involved in some major programs. But part of my philosophy is, I don�t have all the skills necessary, all of those of that perfect leader.

And fortunately, I have, again, great people, great leaders who work for me and work with me, and my style is, maybe it�s a little bit of Gestalt Theory, but it is to work with them in a collegial fashion, to let them manage their organizations, but at the same time at the top, get them to put on their corporate hats, and help me manage the program together.

And I also work very closely with my deputy, Bob Mocny, who has extensive background in the business and really complements me as well as other skills that he has.

Mr. Lawrence: You mentioned your management approach and style. Has it changed over your career in the sense that when you were doing procurements, to now leading major programs?

Mr. Williams: I�ll be honest, Paul, I don�t really go back and examine my leadership style. When people ask me what is it, I had never really given it much thought until somebody asked me that recently. I kind of think you hire the best people you can; you get them focused on the task and that�s how teams come together, really get people focused on the task, and you kind of follow the Golden Rule, where you treat people the way they want to be treated, and I�ve always found that things pretty much fall into place after that.

I think in this particular job, what may be a little bit different is coming in there in a post-9/11 mode, there was so many people who were so dedicated, and 9/11 is mentioned every day in our world. Always believing that there is a threat out there, and that we need to protect America, and I think that motivates people enough. I try to give them all the resources and the support, and also try to create an organization that has the right values.

Frankly, we would like to have one, because we work hard. People spend a large part of their time there. We�re an organization that likes to say "thank you� to people, because so many people help us in partnership. That�s, I guess, one of my philosophies, probably came out of my parents; try to have simply good manners around people.

Mr. Lawrence: That�s an interesting point, especially about values.

What are the details behind US-VISIT; what kind of information is collected; and how is it used? We�ll ask Jim Williams, director of the US-VISIT program, to take us through this when our conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Jim Williams, the director of the US-VISIT program at the Department of Homeland Security.

Joining us in our conversation is Todd Wiseman.

Mr. Wiseman: Jim, how does US-VISIT work, and what is the procedure, and what can a visitor expect when he or she is entering and exiting the U.S.?

Mr. Williams: Well, first of all, it can start when people first apply for a visa overseas, and when they apply for that visa, it�s the same procedure that you�ll see at any airport, or seaport, or even in our land border crossings. The visitor, if they are a non-immigrant visa person, or a visa waiver person, those people are currently included in US-VISIT. They�re asked to take a few extra seconds to put their first left index finger scan, right index finger scan, and again, it�s an electronic fingerprint, and also takes a digital photograph. That goes on during the normal inspection when the people are coming in to the country.

We�ve estimated that it takes about 10 to 12 seconds to do that. After they put down their finger scans and they�re recorded, the inspector continues the interview and they press �Send,� and those fingerprints are checked against our watch list. Our watch list is updated daily with additional fingerprints from the FBI, and within five seconds, the inspector has his computer screen, either blinks green, no hit; or it blinks red, meaning it looks like it�s a match against a fingerprint that we have on our watch list.

And it�s really that simple, but we also enroll people so that we record their fingerprints and attach them to their identity. So if Jim Williams comes in to Dulles Airport one week, and we take the fingerprints and enroll those as Jim Williams' fingerprints, and the next time the person comes around, we just do a one-to-one match against the fingerprints we already have.

We also take those fingerprints that are in our database, what I would call the �Good guy database,� the people who have been enrolled, and we run them continuously against our �Bad guy database.� And in fact, we have instances where we�ve gotten hits of people who�ve come in to the country legitimately, but then we�ve had an update of fingerprints from the FBI, or from other sources that are in our watch list that then indicate the person is a hit, and we alert our Immigration and Customs Enforcement people who go out, and find the person.

Mr. Wiseman: You�ve described the biometric capabilities and the system around that. How accurate is that technology today?

Mr. Williams: Fingerprints are very accurate. Our accuracy rate today is 96 percent, and that means when -- say we already have somebody�s fingerprints either in our database and we get a fingerprint, we could match it 96 percent of the time. There are certain people who fall out of that; people, frankly, who don�t have fingers. But where we do have a false positive, that�s where the screen blinks red, because it looks like a match. Those fingerprints are immediately, within a second or so, sent to a human fingerprint examiner who can tell whether it really is a match, or whether it�s a false positive; meaning it�s a good person, it wasn�t the bad person we were looking for. They can clear this up within about three minutes.

Mr. Wiseman: Is there other kind of information captured in addition to the biometrics, and if so, how is that information used?

Mr. Williams: Well, prior to US-VISIT, biographic information was collected as, for example, if you�re flying here from Heathrow in London, the airlines are, most of them, are sending us electronic manifests of who�s on the plane, and those electronic manifests that are usually sent 15 minutes after wheels-up are checked against a biographical set of watch lists. That�s about 26 different watch lists combined into one that will then tell us is there a biographic, or date of birth, or passport number hit on that particular information.

And if there is, when the person arrives at, say, Dulles Airport, and their passport or visa is read, it will then identify has that record been flagged as being a biographic hit, combining with the biometrics, though. Biometrics helps do a better job of confirming identity.

We had a person who had come into the country who was a convicted rapist, and we were looking for this person, and realized after catching him that he�d come into the country using nine different aliases, four different dates of birth.

And another hit we had about the same time was a person from Jamaica wanted for drug smuggling -- clearly, an aggravated drug trafficker. And that person we found out had come into the country 60 times in the previous four years. And we know that people can buy fake passports, and false identities, and what our Chief Privacy Officer, Nuala O�Connor Kelly says, when you use biometrics, it doesn�t take away your privacy; it protects your privacy. It protects you from identity theft because nobody else can use your fingerprints.

Mr. Wiseman: You touched upon it, but if you could just repeat, about who exactly is required to enroll in the program?

Mr. Williams: Today, it�s anybody from any country that requires a visa to come to the United States, or anybody who comes in what�s called the visa waiver program. That�s a program where people from 27 countries, like England, France, Germany, Japan, Australia, can travel to the United States for business or pleasure for up to three months, and they do not need to go to the State Department to get a visa.

But we did, starting last September 30th, include those people in the program, because it�s so easy, it�s quick and it enhances security. And in fact, we've surveyed many travelers, and the vast, vast majority of them say they don�t mind. In fact, they tell us they feel safer. We�re hoping that part of what we see in the recent upswing in travel and tourism is due to the fact that people feel safer in traveling. And as one Customs and Border Protection Officer at Dulles told me, when people ask him, �Why am I doing this?� he says, �It�s to protect you.� And in fact, it does.

Mr. Lawrence: Could you tell us about the deployment schedule, where you are and what the plans are?

Mr. Williams: Sure, Paul. We first deployed according to this -- the number one Congressional Mandate to be at the airports and seaports, and we did that at 115 airports and 14 seaports for entry. And that started January 5, 2004. And we met the date; we were ready to go at the end of 2003, but there was a request from the private sector to delay the live implementation until we get over the nearest holiday weekend, which we did, even though we were ready to go. So we met that date on time. We also began pilot testing exit at the airports, and I�ll talk about that in a minute.

Our next goal was to be at the 50 busiest land ports of entry, and this is a congressionally mandated goal by the end of 2004. We actually met that ahead of schedule, and we started implementing November 15th and we finished December 29th, so we were ahead of schedule, and I�m pleased to say we�ve met all of our dates set by Congress, and I think that�s important to maintain credibility.

We�ve also begun pilot testing exit at airports, and what that means is, if you�re leaving out of, say, Dulles Airport or National, you�re taking an international flight, today, you go to the ticket counter, the e-ticket booth, you go to the TSA screening, and you go to the gate, there is no check-out of this country, and that�s different from other countries. If you leave through, say, Tokyo, or Poland or somewhere, you actually check out; you actually go into a separate physical part of the airport and you�d go through a check-out procedure. The United States doesn�t have that.

But in order to have integrity in our immigration system, as the President said, we want to know when people are leaving, and that�s how you ensure integrity of the people, follow the rule of the law in terms of their admission. So we�ve been trying to pilot test the biometric collection for people when they leave the country, and we do that through using two different pieces of equipment that we�re pilot testing.

One is a kiosk; it looks like an ATM machine. You can actually see one in BWI Airport right now. And the other is through a mobile handheld device, and we use that in two different ways. But generally it�s a device that was built for us that takes fingerprints, takes photographs, and also can read the machine-readable part of your passport, and that�s the letters that are at the bottom. They�re in a special font so that it can be machine-read.

I will tell you another thing we did as part of this, and this is something that we did in conjunction with The Department of State: was when we first deployed this, we wanted to better link databases. What Congress said was better link databases so that people have the best information they can at their fingertips.

And we put in for the first time a capability, when that machine-readable zone of the passport or visa is read, for the first time, the picture that was taken overseas by the State Department pops up on the screen, the picture of that traveler. And that allows us to see when people have photo-subbed passports. Meaning they�ve taken the photo of the legitimate person off and they've substituted their passport. And in fact, in one case the photo popped up -- a woman appeared on the screen; and in front of the inspector was a man. So there was clearly a photo-sub-passport.

And our eventual goal is to improve upon that capability, and we�re like any other information system, where our goal is to get the right information to the right people at the right time to make the right decision. And we�re trying to build in our next implementations a capability to build a database that has that information that is necessary for either a visa-issuing officer at State, a Citizenship and Immigrations Services Adjudication Officer, Customs and Border Protection, or Immigration and Customs Enforcement Agent, anybody who encounters that traveler should have all the information about that traveler.

That helps good people get processed easier, and it also stops bad people, because everybody who has to make a decision about that traveler should have all of that information at their fingertips. And we link together databases, but we really want to build a composite of all of the information that should be available to those people for the future.

Mr. Lawrence: You talked about leaving the country and how other countries have an exit system. Where will VISIT put us in terms of the ways other countries think about this problem?

Mr. Williams: Well, we�ve been pleased to see that other countries have followed us in some sense and have been building up their Immigration and Border Management System. We are pleased to see that the EU announced for their visitor information system that they will also be taking fingerprints, digital index finger scans and digital photographs.

The Japanese recently announced for their visitor system that they were going to model it after US-VISIT. I believe England recently announced that they will also be taking fingerprints and photographs of the people coming in. And we think it�s important that all countries do what we do, and we follow their lead in many cases, which is strengthen our Immigration and Border Management Systems, but do it in a way that follows standards.

And that�s what we have done is followed international standards as we�ve implemented this program, and we think that�s important, because the way you can start to harmonize global travel is to follow standards. So we�ve been very pleased that other countries have come to us many times and wanted to find out more about our program, and in fact, wanted to replicate it in their countries.

And, again, that is something that can only help good people travel easier, and our ultimate goal is to be able to expedite those legitimate people. But it also helps for us in the collective war against terrorism. It is really a war that every country has to fight. And the best thing we can do is fight it together.

Mr. Lawrence: That�s powerful about standards.

What other agencies are working with DHS on US-VISIT, and how are they collaborating? We�ll ask Jim Williams, director of US-VISIT to take us through this when The Business of Government Hour continues.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Jim Williams, director of the US-VISIT program in the Department of Homeland Security.

And joining us in our conversation is Todd Wiseman.

Jim, earlier, you�ve talked about the other organizations that you�re collaborating with, and so I�m curious, how have you collaborated? That�s often the challenge in sort of cross-government activities, is getting organizations to work together. How has that come about?

Mr. Williams: Well, part of collaboration is heavily dependent upon, I would say, constant communication, and enforcing mechanisms to get people together. We have an integrated project or product team that meets once a week; about 50 people in a room. And that�s people from different parts of DHS, including those ones I mentioned before: Customs and Border Protection, Immigration Customs Enforcement, including people like Coast Guard, Citizenship and Immigration Services, as well as people from the Department of State, Department of Transportation, Department of Justice who attend every time.

And that�s really a working-level broad meeting to communicate about some of the things that are going on. And then we have several other working groups that work on specific issues in which people from those different agencies are involved. We also have a US-VISIT advisory board chaired by the Under Secretary for Border and Transportation Security, and that includes senior leaders like Janice Jacobs, the Deputy Assistant Secretary for Visa Services, Department of State; people from Department of Transportation; Doug Baker from the Department of Commerce; two individuals from Department of Justice, and that�s just a collaboration, again, at the federal level.

We also have a bi-national working group with the government of Mexico that works very well. We are starting a group with Canada, and, again, that�s just sort of government. We also work very closely with the private sector, because what we really want to do is -- if you look at going through an airport, we want to be able to meld that experience, enhancing that security as part of the airline travel experience. And the airlines have been fantastic to deal with.

I can�t say enough good about the partnership from the airlines, the airports, the cruise lines, all of them have recognized the need to enhance security. They know we care very much about what they care about, which is facilitation of travel and facilitation of trade. We know, when dealing with the land border, that $650 million a day goes over the border between U.S. and Mexico, and it�s double that with Canada.

And if we do something that builds Fortress America by just doing it as a federal government mandate to enhance security, the terrorists win. And so we know we have to protect our economic security, and that means that�s about partnership. So we need to have collaboration, communication, and partnerships with just about everybody: other countries, our government, even eventually dealing with the state and local, but also the private sector.

I often give a very futuristic example, which is probably not a good one in our lifetime, that someday, you may walk into an airport and all you need is your digital finger scan, because that is your credit card, and that is your boarding pass; it determines your screening level. And that does verify that you�ve left the country, and it provides you all the benefits you need, because when it comes down to it, it�s about identity verification and identity management; making sure you know who that person is, and attribute to them the right either benefit or the right level of screening.

Mr. Wiseman: How are you training the employees, both within DHS and any related cross-agency, to use the new functions and technologies as well as the biometric capabilities of US-VISIT?

Mr. Williams: Well, as we begin to roll out a particular increment, or a next phase of US-VISIT, we always look to develop a team together who would decide what the best way to train is. And we also want to try and fit that training within what is a reasonable schedule. And we test the training too, because ultimately when we are delivering technology, or delivering business process change, it�s something new, it�s a change. And it has to be accepted by the users. And our change, and our training about that change is about both how to use the technology, if you happen to be a government official, but it�s also in a way training our passengers.

We put out videos to tell people what the procedure�s going to be like; show them in airports, on airplanes, so that people could assist themselves in terms of getting through the process. And I think that kind of outreach and the training and awareness really helped everybody, because it made the learning curve not steep in terms of being able to smoothly implement this change. So whenever you�re talking about a change, training is critical, and training in the way that people want to hear it.

Mr. Wiseman: You talked a little bit about privacy earlier, but how do you address the privacy concerns of people coming through the US-VISIT system?

Mr. Williams: We�ve been very pleased with the kudos we�ve received about privacy, because we pay special attention to it. It is one of our four primary goals. The U.S. Privacy Act, and the e-Government Act, which contains privacy protection provisions, doesn�t apply to foreign visitors today.

Working with, again, Nuala O�Connor Kelly and the rest of DHS, we made the policy decision to apply it anyway, because we wanted people to feel safe in terms of giving us that information. What that means is that we publish systems of records notice in the Federal Register. We publish our privacy principles. And we operate in the very bright sunshine of day, answering all those basic privacy questions that anybody would want to hear.

And those questions are: what information are you collecting; how long are you keeping it; who are you sharing it with and what�re they doing with it; and how do you have privacy protections in there. And I think this is important. I�ve often said, in talking to groups, if you�ve ever been through the Spy Museum, they have a survey upon the wall, how many Americans think the U.S. government is keeping a secret database on them? What percentage of Americans? And the answer is 67 percent.

So I assume that if 67 percent of Americans feel that way, think about what our foreign visitors feel about what we�re doing. And so we have tried to operate extremely openly about privacy, and we�re vigilant about it. We have a privacy officer who works for me, Steve Jonkers, who does a great job. He�s been a little bit like the Maytag repairman waiting for the onslaught that really hasn�t come. We�ve had very few letters, mostly people feel like -- the husband and wife fingerprints gotten mismatched or mixed up in the system, or people writing to us for other things.

I think what CBP, Customs and Border Protection, has done in terms of their professionalism initiative, and in terms of what we�ve done to convince people they�ll be treated with respect, their information will be treated with respect, has really helped to lower those types of complaints.

Mr. Wiseman: You mentioned earlier that US-VISIT is really designed to positively affect trade and tourism. Are you seeing any evidence of that through the recent efforts that have occurred?

Mr. Williams: Well, actually yes, Todd, I think we have. At the land border, where we implemented this, we only implement it for those people going to what�s called secondary processing. That�s a small percentage of people coming through land borders. But as we did this, there was very, very much concern that we were going to slow down trade and travel at the land borders. And in fact, at all of the top 50 land borders, which covers about 90, 94 percent of the people coming across the land borders, which out of that about 450 million, maybe half a billion people, that�s probably 350 million people a year.

So everybody was concerned about what we�re going to do there. But in fact, what we�ve done in every one of those 50, we�ve accelerated the processing of people. One of our best examples is Laredo, Texas, where prior to US-VISIT being put into secondary processing, somebody who had to come in and get a visa, it was taking about 12 minutes per person.

Well, we put in some other procedures to print out a 994 in a pre-populated way; whereas before, the person, either the officer or the visitor, had to handwrite it and fill it out. Now that we�re printing it out automatically, that 12 minutes has gone down to about two minutes. So we�re very proud of that, that we have enhanced security and expedited people.

And that�s our ultimate goal. We�re actually building a strategic plan that Congress wants us to build, and then that is to look at what is a comprehensive view of what a 21st Century Immigration Border Management Enterprise should like. Looking across all of the different agencies across the different constituencies, and say, what should this look like in the 21st Century? How can we expedite all of these good people who want to come to America, and at the same time enhance security? And that�s what we�re developing right now.

And we think the benefits of investing in the borders are enormous. When you look at the competitiveness issues that are necessary in terms of efficient travel and trade, what we can deliver by just thinking about some of these busy ports of entry. If we could cut the lines in half, just imagine what it does in terms of the economic benefits and also the benefits of the intangibles. We want people to come to America to learn about America and explore America�s values, and in order to do that, we have to be something where it's easy to get here. And that�s really what we�re focusing on.

Mr. Wiseman: Can you tell us about the plans underway to centralize the management of screening and credentialing programs across DHS, and specifically within border and transportation security?

Mr. Williams: Yes, that�s in the President�s FY�06 budget that he delivered to Congress on February 7th, and he�s proposed an Office of Screening Coordination and Operations. And it�s really something that gets at the reason why DHS was created, which is really to integrate functions, and operate more effectively and more efficiently.

And where we had different screening going on, right now, across DHS, we need to be able to leverage that capability, and leverage that capability for efficiency purposes. So we don�t have many different institutions, whether they are Coast Guard or Citizenship and Immigration Services, TSA or Customs and Border Protection, building duplicate facilities unnecessarily. And we are also doing it in a way that it will leverage it across DHS so that we can effectively share information.

As the 9/11 Commission said, �Connect the dots.� We want to be able to do screening in a consistent manner, and not screen that same individual with one set of screening tools, say, and then do it a different way for a different individual who�s there for a similar purpose.

I think we also look at the opportunity of the Screening Coordination and Operations Office, and I think Secretary Michael Chertoff completely agrees with this, as I�ve heard him already speak, that this is part of the reason why DHS was created is to look for this integration, where you can start to leverage common capabilities. And when bringing these programs together in a centralized mode, the key to this is to be able to make the missions in the field more efficient.

I don�t believe in centralization for centralization's sake. I believe you do it so that you can enhance the mission of all of those field officers who have a job to do, and we can deliver them operational support services more efficiently and be more effective in terms of information sharing. So I think that�s part of the promise that's in the President�s Fiscal year �06 budget, and it also has other things in there about combining registered traveler programs.

And from the standpoint of a traveler, we look forward to the day when if you want to be an international registered traveler and a domestic registered traveler, you can be screened once. If you�re flying from Charles de Gaulle Airport, again, into Dulles Airport and you want to come in and you want to be an international registered traveler, which becomes something where you could register for that. But if you want to just spend a day in D.C., and then fly up to New York, you�re also a domestic registered traveler; one enrollment, one screening.

And you start to leverage that capability. And people who are travelers will appreciate that, because it really goes to the government trying to act in the view of how a person wants you to act. They want the government to act based upon who they are, not how the government is constructed. In the �90s, there was a lot of focus on customer service and focusing on the customer, and I think that�s a great thing. I had the opportunity to serve under Charles Rossotti, Todd, as you know, at IRS; a man who frankly is one of the smartest people I�ve ever met and really knew how to focus on this.

And I think focusing on delivering government services so that it looks like one government, and not separate stovepipes to the traveler was important. I think what happened on 9/11 then took us into the mode where we had to act as one government for security reasons. As Secretary Ridge used to say, �We�re no longer in a need to know, we�re in a need to share now.� So we need to be able to share with adequate privacy protections, but share in order to have effective security. And at the same time as we�re doing this, we�re meeting that goal of being able to act as one government from the customer standpoint.

So acting as one government for security against the bad people; acting as one government, that horizontal government, to really act the way the citizens would expect that one government would operate.

Mr. Lawrence: That�s an interesting point about one government.

How will US-VISIT be affected by advances in technology? We�ll ask Program Director Jim Williams for his thoughts when our conversation about management continues on The Business of Government Hour.

(Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I�m Paul Lawrence, and this morning�s conversation is with Jim Williams, director of the US-VISIT program, the Department of Homeland Security.

And joining us in our conversation is Todd Wiseman.

Mr. Wiseman: Jim, fingerprint scanning is probably just the beginning of new technologies that are rapidly being deployed within the US-VISIT system. What other technologies are in development, or do you view as key to the future?

Mr. Williams: I think the biometric technologies are important; whether it�s finger scans or even using digital photographs and looking at facial recognition. In the future, potentially, even iris scans. And we track all of these things. We work very closely with our Science and Technology, and also with NIST, part of Department of Commerce, the National Institute of Standards and Technology.

Beyond that, as I talked about earlier, we want to be able to develop a database that has all of that right information, and that can also present it in a way that the different users want to see it. And that goes to a services-oriented architecture. Scott Hastings is our CIO; he�s been leading that effort and doing a fantastic job to make sure we can help develop what we need for US-VISIT, but also do it in conjunction with the DHS and the Federal Enterprise Architecture.

We�re also looking at pilot testing radio frequency, or some type of automatic identifier technology for the land borders at primary processing this summer. And then just looking at a way to do this so that we can electronically, for the first time, know who�s coming in, and electronically verify that people are leaving.

And we will do that in a way that protects privacy, because the information that would be collected is just a serial number that then links to a database; that allows us to protect privacy; meaning if you had a radio frequency card as a regular traveler across the border and somebody could read the card, all they�d read would be a number like 234589, they wouldn�t read any personal information that would be in the database.

So I think we�re always being tested from a technology standpoint to look at biometrics, look at automatic identifiers like radio frequency, but also just to continue to develop the information technology platforms that we need to really modernize what�s behind all of these missions, and make sure we can help unite the missions around the unifying technology.

We also have to look for more mobile devices, because we want to be there where the people are; where we have, for example working with the Coast Guard, we�re not going to be able to put a kiosk out there on a small boat for the Coast Guard. So we want to be able to work with them on a mobile device that can collect the biometrics of people, and have it done in a wireless manner, so that where they want to check against our watch list, they can collect those biometrics on a mobile device and check in a wireless way. So that we provide people the tools that they need to get their job done better.

Mr. Wiseman: How do you envision the US-VISIT program 5 to 10 years from now?

Mr. Williams: Well, hopefully we will have made significant progress in achieving a critical mass of what I think is a dream of -- not the dream, but the mandate from Congress and from the administration, to build out this biometric entry and exit system. And I would see some key components there. One is that we have the capability to biometrically confirm people�s entry when they come in through legitimate ports of entry, and when they leave, through a legitimate port of entry.

We also built that system in the middle that allows for the encounters with that person. For example, if you're somebody coming in under a tourist visa and you want to enroll as a student, you want to change your student visa, that�s Citizenship and Immigration Services doing their adjudication job. Or if somebody comes in as a tourist and you get sick and you�re in the hospital, and you have to extend your stay; again, we want to build an information system that is flexible, redundant, but it provides all of that right information to all of those decision-makers instantly, so that good people are not harmed by all the officials not having access to that particular information.

The US-VISIT system, that it is something that, again, works together well with the travel experiences and with the private sector to become something that people don�t even think about; it�s just something that makes them safer, and expedites what they need expedited, whether it�s dealing with the immigration system -- and in fact one of the things we�d like to do, we use paper I94s. Our goals eliminate that paper I94, and eliminate those parts of the Immigration Border Management System that frankly, when you look at them, they look like the 19th Century, not even the 20th Century, and take this into a 21st Century that serves the needs of legitimate trade and travel.

Things move very quickly around the globe. And we -- we the government have to be able to have systems and business processes to be able to keep up with that. And I often talk about our strategic plan and what we want to have, and I look at it as calling it an enterprise, or call it a system, or call it a community, where you have for the 21st Century the right business processes and the right enabling technologies and the right people, and the right infrastructure or facilities harmonized with the right policies that then make for a 21st Century border that meets all of those goals that I talked about, and looks like the 21st Century. That�s really where we�d like to be in 5 or 10 years.

Mr. Wiseman: You mentioned the international or global harmony with both trade and tourism. How much of your focus today has been on the international relationships, and knowing the future in 5 to 10 years will even be more globally interdependent?

Mr. Williams: Well, I would say with our partners and neighbors, Canada and Mexico, we spend a lot of time, but also with other countries we do, because as we�re trying to build our systems, first of all, we want them to be aware of what we�re doing so that their citizens are accepting of what we�re doing. So we work very closely on education, outreach with them in terms of those type of things.

In terms of other countries, there�s a lot of different work being done at different levels. We work very closely with the State Department. Maura Harty, the Assistant Secretary for Consular Affairs Worldwide, has been an absolutely fantastic partner and her two Deputy Assistant Secretaries, Frank Moss for passports, Janice Jacobs for visa services.

And, in fact, Frank and I are probably going to head down to Australia to talk to the Australians and other countries about -- as we look at the challenge of biometric passports, which is another mandate of Congress, we would actually have a chip in your passport that would include your digital photograph and your other biographic information. This is new, and in future, it will no longer be just a paper document; it�ll have electronics inside of it -- and talk to the Australians who�re developing this about how do we make sure -- as they develop this technology, and the other visa waiver countries develop this, that it meets all the standards so that one reader could read any passport from anywhere in the world.

So what we�re doing is joint testing with them to make sure that our readers can read their passports; it can read a Japanese passport, a British passport, all of those things. And then how do we build those into what might be a new process that again might facilitate legitimate people�s travel. So we have constant communications around the world, and it�s important. And frankly, it�s enjoyable, because so many people are focused on the same things we are, which is combat terrorism, and expediting the movement of good people around the world.

Mr. Lawrence: Jim we have time for one last question. So I�d ask you to be reflective. You've spent your whole career working on some of the most important programs and problems we have. What advice would you give to a person, perhaps a young person, interested in a career in public service?

Mr. Williams: Well, first of all, Paul, I guess I would say I�m a shameless recruiter. I recruit anywhere I can: elevators -- I was -- I�ll tell you a funny story. I was once being audited by the IRS when I worked there, and I was really impressed by the young woman, and I said, �You know, you really ought to come work for me rather than working on this,� and she got up and left, and my wife said, �Jim, are you trying to bribe this one with a job?� And frankly, I wasn�t. I�m always looking for good people and -- I�ve been in government over 25 years, and I�ve never had a dull day.

I find it incredibly rewarding; I enjoy it. I love the job I have right now, and I would say join public service; that you will find satisfaction in your life, because you�re making a difference. And also, I think the difference in public service is, often, you get a much higher level of responsibility at an earlier age than you ever would in other places, just because there�s so many important, enormous endeavors that are critical to the nation, that you find yourself at a young age being thrust upon with these heavy responsibilities, and they�re exciting.

And you�re involved in huge change, and anybody who wants to come in to government, I would say, �Come on in, the water�s fine; jump in.� Frankly, it�s a lot of fun. It�s something that -- it�s interesting issues. You get to work with great people. And some of the people that I�ve worked in government -- most of the people -- vast majority, whether I�ve worked with them, for them, under them, are incredibly intelligent, dedicated people. They�re not people who work 9:00 to 5:00, trust me. They�re people who work practically around the clock, and it�s because they enjoy it.

They care about their families and loved ones, but they also care very deeply about this country and care about the work that we do. I happen to think that we are the greatest nation on earth, but I think that America is something that we always have to treat as something as very precarious; it�s something there we have to always make sure that, as John F. Kennedy said, �We have the best and brightest.�

And I always think it�s so neat when I see people like, you know, a Charles Rossotti, a Tom Ridge, or a Asa Hutchinson, Michael Chertoff, Michael Jackson, those people who you know could be making 10 times as much money, or whatever, and they care about this nation, and they come in and they provide the leadership we need to do the job that needs to be done to protect America. It�s what our founding fathers wanted for this country is those type of people to come in, and so it's often a good training ground too. If people want to go out to the private sector, you know, that�s fine, too. Get both sides of the fence, but if you want to have a successful job in the private sector, nothing�s wrong with starting in the federal government and getting that experience underneath your belt. You�ll enjoy it.

Mr. Lawrence: I�m afraid we�re out of time, Jim. Todd and I want to thank you for being with us this morning and then squeezing us in your very busy schedule.

Mr. Williams: Well, thank you, Paul. And if people want to learn more about our program, they can always go to the DHS website. That�s www.dhs.gov, and look for US-VISIT, and you can find out lots and lots of information. In fact, if you want to be on our e-mail mailing list, you can contact Anna Hinken. She�s our outreach director. I often introduce her as �anna.hinken,� and that�s anna.hinken@dhs.gov, and then if you get on our e-mail mailing list, we promise we�ll never let you off.

Mr. Lawrence: Thank you, Jim. This has been The Business of Government Hour, featuring a conversation with Jim Williams, director of the US-VISIT program in the Department of Homeland Security.

Mr. Lawrence: Welcome to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers and the co-chair of The Endowment for The Business of Government. We created the endowment in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about the endowment by visiting us on the web at endowment@pwcglobal.com. The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business.

Our conversation today with Marty Wagner, associate administrator for the Office of Governmentwide Policy at the General Services Administration. Welcome, Marty.

Mr. Wagner: Good to be here.

Mr. Lawrence: And joining us in our conversation is Steve Seike, another PwC partner. Welcome, Steve.

Mr. Seike: Good to be here, Paul. Thanks.

Mr. Lawrence: Well, Marty, let's start by finding out more about GSA and specifically the Office of

Governmentwide Policy. Could you tell us about its activities and its role?

Mr. Wagner: Okay, I think most of your listeners probably know about GSA. It's the government's big buyer of stuff. And we tend to do a lot through the Public Buildings, through the Federal Supply Service, Federal Technology Service. This is where about 14,000 employees set up contracts that are used by the government as a whole for all the goods and -- or for many of the goods and services that they do.

I don't do that. I have what's called the policy function, where we look at the overall system, not just the specific contracts that GSA does, but the $200 billion or so of government procurement, the $300 billion a year of grants that are issued, how those systems manage the way we travel.

I have the policy function at GSA. Now, the policy function used to be -- until about five years ago -- simply part of the different operational arms of GSA. But what we got into through some discussions with OMB and various reviewers is a sense that GSA was getting too much into the operations, and that frankly, there were some concerns that there was a conflict of interest between managing the policies for how the government bought everything and also being in the system of running contracts that then other agencies use.

So in fact, that's what we do in Governmentwide Policy. We've centralized all the management functions of government in one place. We look at the government as a whole and try to make things so that the government is better managed than it otherwise would be.

Mr. Seike: Marty, the thing that I'm curious about is how is the Office of Government Policy different than some of the other agency policy development units, like the Government Accounting Office or the Office of Management and Budget?

Mr. Wagner: Well, I think we probably have some parallels. General Accounting Office probably has more of an audit and oversight role than we would have. We're really not in the business of looking over the shoulders of agencies. We're more in the business of developing best practices and, frankly, the regulations and the guidance for how agencies ought to operate.

OMB tends to operate at a higher level. We work very closely with OMB, but we're not OMB. OMB has the budget; it has the management and the regulatory reviews. A lot of those areas have implications that are a lot broader than OMB can actually do itself, and that's where we get involved.

So, for example, OMB does the budget, but working with the other agencies on the federal acquisition regulations, the federal travel regulations, and the way the -- developing the government's internal processes, that's where we work.

We work also a lot with the agencies. One of the things that we found when we consolidated our operations is the government probably historically has had a top-down approach to policy. Something would go wrong, and we would develop a rule against doing that bad thing. And we found that that probably gets you a fair distance, but you're actually going to do better in developing your policies if you work with the community that is affected by those policies to develop approaches that solve the overall problem � not avoiding the bad thing, but doing the right thing. And we would work closely with the agencies and OMB to develop and then implement those policies.

Mr. Lawrence: How big is the Office of Governmentwide Policy, and what are the skills of the people who work there?

Mr. Wagner: We're about 300 people overall, and the skills tend to be management skills in all the management policy areas. So we find-- and I may miss a few as I go down the list, but for example, acquisition, procurement. The Federal Acquisition Regulations, the Federal Acquisition Institute for Training, acquisition professionals, we have those policy functions. So you have people who understand procurement. That's one community. The Federal Travel Regulations, those who understand travel management, travel contracting, procurement of travel services, per diem, when we set the per diem rates in different cities -- a function that makes us extremely popular in certain circles, he said, tongue in cheek. But there's that area. Mail management, management of personal property, management of real property, disposal of personal property, disposal of real property. And then one that I think is particularly important and has certainly been growing in importance: electronic commerce, information technology, all those areas. A lot of what the government is going through is using information technology to be more effective, and it cuts across all management areas and, frankly, is probably our key to productivity gains in the future.

Mr. Lawrence: GSA seems to have somewhat of a unique role. How would you describe the culture at GSA, perhaps in contrast to other parts of the government?

Mr. Wagner: Well, I think GSA's got a very customer-oriented culture, is embracing technology more avidly than many agencies, but certainly not as quickly as some of the real technology-focused agencies. Very much into using an e-marketplace.

I think part of that is driven by -- when we talked earlier about the policy function and the separation and all the

forces that led that to being -- one of the things that happened with GSA is we, as a matter of conscious policy, moved it from a mandatory source of supply to one where it was optional.

And that's got a couple of advantages. One advantage is human nature. People tend to run away from the thing they're told they must use. So that barrier to using the vehicles went away. But it also means that it's an enormous incentive on the services to be efficient and effective. And that also cuts through into the way they operate internally. So it's actually been a -- I don't want to say it's better than every other agency I've worked in, because all the agencies I've worked in have had a lot of advantages. But it does have a somewhat more customer-centric culture, and I enjoy that. And since I like technology, I like being able to have it on my desktop and use it to good effect.

Mr. Lawrence: Marty, let's spend a little time now talking about your career? What drew you to public service?

Mr. Wagner: I think my big drive to public service is that I wanted to make a difference. I wanted scope. I wanted some ability to change the world. Originally, when I finished graduate school; I had gone through as an aeronautical engineer; I did a bachelor's and a master's degree, but the first job I got was working for a consulting company doing the cost/benefit analysis of the space shuttle. And it was all under contract for NASA. And I just thought space was neat, and being a player in the decisions of how we were going off into outer space in a standard, effective, businesslike way was sort of fun.

So from that, I went back to graduate school, this time in public administration and was trained in economics and public policy and thought that's a way to affect things. And after that, well, where is the action?

At the time, the action was the Environmental Protection Agency. So I went and worked there. And after awhile, the action was in telecommunications, and I went to OMB and worked there. And then � you don't want to be too long at OMB. I think it's a very good place to work but I thought it was time to move on.

I went to Treasury and did telecommunications for Treasury. Then I left Treasury to go to GSA, where I did information technology -- computers. And I did that for awhile, and then I got into electronic commerce, and these days I'm doing management.

As I look back on my career, I say, "Gee, I kept moving around and doing different things and they were always interesting and they always broadened me and improved my skills." And where else but the federal government could I have done all of those things? So that's pretty much how I got into it.

Mr. Lawrence: We're talking with Marty Wagner of GSA. This is The Business of GovernmentHour. We'll rejoin our conversation in just a few minutes. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers. And today's conversation is with Marty Wagner, associate administrator for the Office of Governmentwide Policy at the General Services Administration. And joining us in our conversation is another PwC partner, Steve Seike.

Marty, in your years of government service, what qualities have you observed as key characteristics of good leadership?

Mr. Wagner: That's a good question. I'm not sure I can give a complete answer, but I think one of the most important characteristics is to be able to see the big picture, to see the things that really matter. It's so easy to get caught up in the things that look really important but turn out to be not so important.

So, I'd say see the big picture, be ready to ask the right questions. I think you also have to be ready to work flat. Most of the things that really matter need you to get a lot of other people, who don't necessarily work for you, to do something that helps you achieve the goal that you want to get. Part of that, you ought to be able to articulate the vision; not just have it in your head, but explain it to other people. Better be flexible, be ready to deal with ambiguity, because there's an awful lot of ambiguity out there. And flexibility is, I sometimes think, the most important trait.

And finally, perhaps a silly one, but say "please" and "thank you." I once was working with an interagency group, and there were several folks that were there who really liked me a lot. And I'd like to tell you it was because I was wonderful, but it wasn't. It was I said "please" and "thank you," and they came from an environment where they basically had to deal with a lot of, it sounded like, not so nice managers, very directive. And just the basics of courtesy -- it's amazing what people will do for you if you just say "please" and "thank you." So that would be my closing thought. A lot of other things as well.

Mr. Lawrence: Let me follow up and ask you about working flat and what the management challenges are from doing that. We note in talking to a lot of government folks that they all would like to collaborate more, yet somehow it never seems to happen. So I'm wondering what the lessons learned might be from working flat.

Mr. Wagner: I think working flat, you've -- first, I think collaboration has worked pretty well. We've done a lot of it. Most of what we do is, in fact, collaborative effort. A problem may be working flat is not the same as working shallow. You've got to be not just talking to people, but moving toward some set of concrete results.

So working flat does require discipline, it requires focusing on deliverables, things that matter. It doesn't mean that you're getting together once a week to, sort of, talk about problems and issues. It means that you're each working towards getting something done. I think probably also it -- a lot of the important things -- an ecological metaphor is maybe not a bad way to think about it. You're doing something, but it keeps changing on you. The goals keep changing. The priorities keep changing. But if you recognize how that happens, you can use the fact that the world will be changing on you to get more done. Because you know something outside of your control is going to happen. You can even predict what a lot of those things are, and act accordingly.

That may be a bit obscure, but think of ecologies, and then think about how that metaphor applies to Washington, D.C.

Mr. Seike: GSA presents achievement awards for real property innovation. Could you describe some of these recent winners and what the impact this has had?

Mr. Wagner: First, let me briefly explain that what we do through many of our programs is that we create awards, which involve personal money going to government employees for things they achieve. Now, that's not altruism that leads us to do this. It's because if you want to find out what best practices are and disseminate them across government, an awards scheme is a pretty good way of doing it. The ones you mention are those for real property. We have them for travel, for mail management, and several other areas as well.

Recently, we gave one to the Department of the Army for privatization of Army utility systems; basically innovative ways of buying things like electricity cheaper.

Building Green went to GSA's Public Buildings Service; a lot of environmentally better ways of building buildings.

So because we make those awards, then we put them on our web page, and then people can learn about them. And we also work with other agencies, so that the average level of management starts rising to the level of what was the innovation of a few years before.

Mr. Lawrence: Now, we've been hearing a lot lately about FirstGov, which is a collaborative government Internet portal. And I'm curious as to what GSA's role in that is, and maybe you could share with the listeners a little bit more about FirstGov.

Mr. Wagner: Let me begin by first giving the URL. If you go to www.firstgov.gov -- and spell it out, f-i-r-s-t-g-o-v dot g-o-v -- although we also made sure to cover various misspellings of that as well; you're going to go to a search engine or a home page which searches everything that the federal government documents on the web.

Right now, that's up to about 33 million documents renewed every week or so. I'm sorry -- renewed every two weeks. And it's a very effective tool for finding out just what's going on in the federal government. It's arranged by category, so it doesn't require you to be an expert in the U.S. government's internal plumbing.

If you type in "passport" in the search box, you go to the place in the State Department, which has the passport office, where you find out about passports. You don't have to know that's how the government is lined up.

And it's, I think, a pretty good model of the transformation the government as a whole is going through. We're going from what I'll call inside-out government to outside-in government. Now, what do I mean by that? I mean that mostly, when we look out, working for the government, we work in our programs and we deliver those programs. We have an organizational view, and we deliver it out to customers.

Turns out that you can also look at it from the other viewpoint. A customer looking into the federal government, what I'm calling outside-in. FirstGov is one of the cuts at doing that. There are some others, which I could get into if you're interested.

First of all, though, it's a webpage that takes you to everything. Then it has taxonomies that lay out -- the information is organized in different ways. It's also consciously shallow. We're not building some sort of huge edifice in front of everything else that the government is doing. The government is too big, it's too important, too diverse to build one thing to be the front end for everything.

But what we can do is make it easier for folks to get to the place where it matters. So if the place you want, the information you want is at a NASA website or an EPA website or something like that, FirstGov will get you there in a fast and efficient way.

Mr. Lawrence: Telecommuting is a big issue, and I noticed that OGP has developed the Interagency Telecommuting Program Manual. I'm curious to know from your perspective, sort of, what's the state of telecommuting within the federal government?

Mr. Wagner: Well, the short answer is telecommuting has got a long way to go. It's going to be really, really a lot more important than it's been to date. It's where a lot of society is going. Because with technology, things like laptops and high-speed access and wireless access, you're a lot more able to work anyplace at any time. Now, the problem you get into is not all jobs fit that way of operating. In fact, we actually probably would prefer to say "telework" instead of "telecommuting." "Telecommuting" carries with it the idea of you really doing the same thing, but "telework," you can take a laptop, be on the road, be in a train, be in an airport, depot, you can do a lot of that work. We're doing more and more in that direction.

We in our own office are setting up hoteling arrangements by which people can more easily move around and do telecommuting that way. There are some real issues to work out. How do you manage a telecommuting work force? A lot of the people who telecommute, or telework, they get nervous about it because if they're not in the office, they're worried about being forgotten. How do you deal with those legitimate concerns and work through that? And frankly, there are a lot of issues in using the information technology, to make it standard and reliable, to work that out.

But we see that as pretty much the wave of the future. It's not going to be for everybody. And you've got true believers who somehow think that anyone can be a teleworker. I don't think that's the case. But an awful lot of us are going to be teleworking more and more.

Mr. Seike: I was interested as a follow-up to that in how many people currently are taking advantage of the program, and do you see that trend continuing over the next five to ten years?

Mr. Wagner: I'm afraid I don't have any good numbers about how many are actually teleworking at the moment, although those figures do exist. They're just -- I don't have them on the tip of my tongue. I'm pretty confident they're going to grow, and they're going to grow a lot. Because at least -- I just look at my own office, and we're just the tip of the iceberg as we start working out exactly how to do this and how to measure it and work more effectively. So the short answer is there's some going on and there's going to be a lot more numbers to follow.

Mr. Lawrence: It's time for a break. We'll be right back with more of The Business of Government Hour and our conversation with Marty Wagner. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner in PricewaterhouseCoopers. And today's conversation is with Marty Wagner, associate administrator for the Office of Governmentwide Policy at the General Services Administration. And joining us in our conversation is another PwC partner, Steve Seike.

Mr. Seike: Thanks, Paul. Marty, can you tell us how FirstGov came about?

Mr. Wagner: Well, I think I talked earlier about FirstGov when we were talking a little more about how that came about. It's an interesting project, because I don't think it fits the traditional mold. It didn't have any budget. It was interagency. It had no natural home. But it did have a presidential management directive that, sort of, told the government to go set up a portal for all its content.

And there had been the work that various folks -- for example, under the Chief Information Officers Council in the GSA � had been working. And so you had a push to do something. And then it went in a period of roughly three months from being an idea to actually being something up and operational -- maybe six months, if you count some of the precursor work.

And the way it kind of happened, I think, is an interesting model. I learned a lot of lessons from how FirstGov came about. You know, lessons -- these may be obvious lessons to the listeners, but sometimes we have trouble seeing the obvious.

The first was leadership mattered. FirstGov was something that people at the senior levels wanted to have happen and did the work cross-agency to get the money together, took a lead to make it happen. So we had high-level involvement: make this happen.

The second lesson is that if you want to get something done, you have to have ability to execute. And in fact, we had a cadre of people in various agencies, including GSA, who could actually get up and get something up and running quickly. We were able to use a lot of the acquisition reforms of the past several years to move very, very quickly to do a very competitive acquisition in a short period of time. We found the value.

Talking to everybody is really important. Communications matters. Even when you're moving quickly, you need to be talking to everybody.

Speed matters, too. We found that not only does speed help you get things done quickly and focus on the things that matter, it also means that your critics are criticizing -- they're behind you because you're already doing something different because you ran into the problems that the critics were pointing out and now moving into another area.

And then, I think, one that may seem a little silly, but it's nice to be aligned with the forces of history. I mean, what FirstGov is is an Internet portal, it's customer-centric, it ties the government as a whole to the people as a whole. And that's a lot of what the whole Internet is about. The Internet is turning a lot of companies inside out. It's changing the way we do business.

And by moving and using what this technology was doing, and moving in the direction of commercial off-the-shelf products stitched together to solve a problem, worked pretty well. And frankly, FirstGov is a model for a lot of the other things we're doing as well.

Mr. Lawrence: What I found interesting about your answer in terms of the lessons was none of them describe the technology; none of them involve technology. They were all management lessons about people, for the most part.

Mr. Wagner: I think that's true. I thought about that, and I thought I might be even overdoing not mentioning technology.

You tend to be in trouble when you're driven by technology, as opposed to technology being a catalyst to enable you to do something else. But you really do have to understand the technology. And when I talked about that middle-management cadre of people who understood stuff, it was really important to have people who understood what the web could do, what it couldn't do, who could weigh the different clouds as the vendors make their offerings and say what you're doing. So technology matters, but it doesn't matter as much as what you're trying to do.

Mr. Seike: What are the plans for the future of FirstGov?

Mr. Wagner: The biggie is, I think, it's less so much a FirstGov set of plans. The FirstGov plans really boil around we've got the search engine substantially improved now over the way it was in the beginning. We're improving the taxonomies. We're working more and more closely with the states on how to tie that in because in fact the states have many of the same issues we have. For example, the U.S. government has 30 million documents online, the states have about 14 million documents online. There's a lot of working through making it better.

But the really important, I think, ties back to the various other cross-agency efforts and, frankly, agency-specific web

portal efforts.

How do you get feedback to be better? We're starting to deliver services over the web. You want to run that closed loop, not open loop. By that I mean you listen to what's happening, and then you adjust accordingly.

So I think we need to do a lot more work with the feedback side and better links back into the other cross-agency portals, like students.gov, or seniors.gov, or disability.gov. I mean, there are various of these websites all built around presenting the problem from this outside-in perspective rather than the inside-out perspective, as well as all those really important agency-specific websites to which we are handing off traffic coming via FirstGov.

Mr. Lawrence: Let me continue this discussion about management by talking about another interesting topic, which is the balanced scorecard. We understand that you're using the balanced scorecard to manage the operations of the ten units under you. Could you tell us about this?

Mr. Wagner: Okay. Balanced scorecard is a pretty interesting approach. What has historically happened with many organizations is the focus on things like the bottom line misses a lot of other things that are important. And what balanced scorecard fundamentally tries to do is discipline yourself to look at more than just a few things.

And in fact, in our case, I think we're nontraditional. I think there are supposed to be four perspectives, but we have five perspectives. But when you look at the things you're going to measure your performance on, you don't just look at the one thing, like customer satisfaction. That's important, but you want more than that perspective.

So what are our perspectives? Well, first is what do we measure from a stakeholder perspective? Our stakeholders are all the folks who are interested in management across the government as a whole. So there are measures from that perspective. There are also the measures from a customer's perspective. We have customers too. If they're happy or unhappy, that matters a lot. We also have internal business processes. Are those processes working well or badly? Very much -- that's another balance scorecard. Budget, keeping track of the money � fairly important to do. And finally, something that I think tends to have been neglected and is going to matter more and more, is the learning and growth perspective. Do your employees know what they need to know? Do they have the tools that they need to know? Are they the right tools for the right job?

So, what are the measures? How do you make sure that you aren't so caught up in making customers happy that you don't deal with longer-run issues like making sure that people will be able to make them happy in the future.

Anyway, we're managing using those five measures. It's, I think, more difficult for a policy organization than an operational entity because a lot of our measures tend to be how do you measure the effectiveness of a policy. It's a somewhat trickier question than, you know, cost per item produced or something like that. But we're finding it a useful way of looking at it.

I will give a suggestion to those looking at it. This is a really good way to look at your programs, but don't get carried away with it. It should be a simple way to look -- it should be a simpler tool for looking at what you do. And this is one way of looking at things, and it's a way of keeping balance. You know, find things that work and be prepared to change. Because what we also find is what we were sure was the right way to do things a year ago, turns out to have been wrong. And that's not bad. It just means you adjust and start working as you evolve towards a better way of managing.

Mr. Lawrence: Let me follow up quickly. When you say use the scorecard to manage, and you describe the different areas, how actually do you use it to manage? Is it the scores or the results in those five areas or is it driven down to a personal level?

Mr. Wagner: We're not as far along as that, to drive it all the way down to every individual in the organization. But basically, you have five perspectives and you look at -- you find things to measure in those five perspectives.

They should be things that encourage the behavior you want. If you want a behavior that you want customers to be satisfied, find a customer satisfaction measure of some sort or another to measure, and that's one of the things doing. If you want your folks to be educated on what they need to be educated on, find something to measure that leads you in that direction.

Mr. Lawrence: Well, great. It's time for a break. We'll be back with more of The Business of Government Hour in just a fewminutes. (Intermission)

Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, a partner at PricewaterhouseCoopers. And today's conversation is with Marty Wagner, associate administrator for the Office of Governmentwide Policy at the General Services Administration. And joining us in our conversation is Steve Seike, another PwC partner.

Well, Marty, let me double back on some of the management issues we were talking about in the last segment. Could you tell us about the linking budget to performance program?

Mr. Wagner: I guess I'll begin, since you're talking budget to performance -- I think I'm quoting Mitch Daniels, the new director of OMB, who said something along the lines of, "If you're not keeping score, you're just practicing." And I think some of the stuff we talked about on balanced scorecard earlier is if you -- things you measure, you'll get more of. And I think that's the first important point -- trying to measure something, and then move in that direction; understand those measures as step one.

Now, there's been a lot of, I think, discussion that gets almost religious about things called outcome measures and output measures and things like that. I think there's something about outcome measures that may bring out the worst in some people. But this is my take on the way we have to go.

First, an outcome is something that you really want to achieve. It's not necessarily what you produce but it's some measure of programmatic effectiveness that is as far away from the nitty-gritty outputs -- it's the higher-level things.

I think what we ought to do is figure out what are the outcomes we want, and then try to measure them. Then we also will be going -- we'll have programs that are moving in the direction to get those outcomes that we want. Those would be outputs that we do measure. Frankly, outputs is things we've done a pretty good job of measuring across a lot of it. We can count what we spend to do X or to do Y, or how many of them that we built, whether they be regulations or sizes or things like that. You can do your outputs. The problem is linking the outputs to the outcomes. And what I would suggest there is, rather than get into trying to quantify it too exactly, tell the story, that people can either believe or not believe, of why the things you as an agency are producing help achieve the outcomes you want to achieve. In my case, the outputs I would have might be things like regulations or accounting best practices or number of visits to a website or something like that. The outcomes I might want, or that I do want, are better management at an agency level. Well, I can't prove that because some best practice came out or that we developed performance measures that they're really making a big difference. But I think I can make a case of why the regulations or the guidance or the performance measures then being used by an agency has led to better behavior.

And the important question is, people can listen to that case, and they can believe it or not believe it and make their judgments. And that's better than being in this well, I can't measure anything or any measure that I have has to be so purely perfect that I can never achieve that. So that's kind of my take on that.

Mr. Lawrence: Marty, let's turn now and focus a little bit on the future. We're hearing this a great deal about the upcoming federal government retirement wave and the impact that that's having on agencies. How big an issue is that for GSA and the Office of Governmentwide Policy? And are you doing some planning and working on some solutions around that?

Mr. Wagner: It's probably the strategic issue for GSA and, I suspect, for most agencies. We have this building retirement wave coming in. I think we've got 90 employees that are currently eligible to retire or will be eligible to retire in the very near future, a significant percentage of the work force. And it's going to continue for a while. It's not so much Armageddon, but it's this rising issue that we're going to have to deal with. So how do you deal with it? Well, one thing is you try to retain people. And there are some financial incentives that you can use in that direction. There are also, frankly, some quality of life, quality of work things that you can offer.

A lot of what we have to offer in the government, frankly, is not salary. We actually can offer scope and opportunity to do things that are really significant. When I was working at EPA, which by now is probably 15, 20 years ago, I was, I guess, down the hall from someone, a GS-11 maybe, GS-12, a key guy working on billion-dollar standards, air quality standards. And he was the person doing all the modeling work. He had a major impact on a multibillion-dollar decision that the government made. Now, that's EPA. I was recently talking to a fellow who worked in GSA's Public Buildings Service, who told me about a job interview when he was a couple years in government and was thinking maybe he'd go into real estate for a company. And the companies that he was interviewing didn't believe what he told them he was doing, because nobody that junior, that lowly paid, would be in charge of projects that big. That's what we've got to offer. We have really good opportunities to make a difference. In addition, I think we've got, you know, good salaries and benefits. And we can have discussions about which areas -- information technology would clearly have some areas of being able to recruit the folks we need and that's going to cut into more than just those areas.

Mr. Seike: Well, speaking of young people, what kind of advice would you give to a young person who's interested in a career in public service?

Mr. Wagner: Pursue things that interest you that you think matter. I think that what public service offers you is a chance to do a wide range of things. And my basic advice was if you're interested in the environment, you ought to be talking to EPA. If you're interested in energy, you know, you've got the Department of Energy. If you're interested in the Treasury Department. There's just a wide range of things that you can do. So the first thing is find something that interests you. Second is move around. Don't stay in just one agency or one office. You move around, you may find that you like government a lot and want to stay, and you may find that you want to go work for PricewaterhouseCoopers, I suppose. I mean, those are opportunities too. You know, but there are your opportunities to do interesting things. And you should care about what you achieve. At the end of the day, if all you do is you're putting in time, you're just doing the job and getting paid, life's too short to focus on that. You ought to be happy that you're achieving something, whatever that thing could be.

Mr.Seike: Would you recommend the development of any certain special set of skills?

Mr. Wagner: Well, I think the � whatever skills that you like. I mean, some people want to be accountants; some, economists; some, engineers; some, marketeers. I mean, there's sort of -- you'll have the skills of the things that interest you. So I'd begin with that. The thing that you may not have thought of, though, is you need to stay current. You need to have the skill to learn a new skill. Half the things I do today I had no -- I knew nothing about only a couple of years ago. And that just keeps happening. So the key skill to learn is the ability to learn new skills and adjust.

Mr. Lawrence: Marty, let's turn now to another really hot topic, and that's the one of Internet privacy. How much involvement do you think that GSA will have in regulating privacy issues in the government going forward?

Mr. Wagner: Well, we're certainly not going to be a regulator of privacy issues, but we're certainly going to be a participant in working through the privacy issues. Privacy is one of those issues that tends to be often mixed in with security, and they are different. When we move to a more and more electronic government, we need to guarantee that we protect the privacy of our citizens.

Frankly, there are some probably larger issues in how the Internet is evolving, when you look at some of the privacy issues there. Simple one; you have a right to be anonymized, unless there's some reason that you need to identify yourself. If you go and pull down a tax form, no one's going to collect anything about you if you're downloading a tax form because that's our duty, is to make sure that that's private. If you are, however, let's say interacting directly with a government agency through the Internet, we have to guarantee that it is in fact you that we're talking to because that's private information.

We're going to be working through a lot of how you actually make that work. We haven't worked out all the answers, but since we have a collaborative model, we've got OMB and all the other agencies that we'll be working together with on solving that over the next few years.

Mr. Lawrence: Marty, I'm afraid we're out of time. Steve and I want to thank you very much for the conversation today. It's been very interesting.

Mr. Seike: Thanks, Marty.

Mr. Wagner: Thank you. Appreciate it.

Mr. Lawrence: This has been The Business of Government Hour, featuring a conversation with Marty Wagner, associate administrator for Office of Governmentwide Policy at the General Services Administration. To learn more about our programs and research into new approaches to improving government effectiveness, visit us on the web at endowment@pwcglobal.com. See you next week.

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